Over the next two years low interest rates could make it difficult for US life insurers to improve their earnings and service debts.
Fitch Ratings has explained that the pressure of low interest rates has already shown to have an effect on insurers’ second quarter earnings.
The Federal Reserve indicated earlier this year that it would not be increasing interest rates until at least 2014.
Fitch say that if rates are kept low beyond 2014 it could have an impact on the statutory capital insurers must legally hold to operate.
Read more about the effect of interest rates on The Actuary.