The situation of European life insurance could bring about a rise in interest rates in the euro zone

Like for all the euro zone’s institutional investors, life insurance in the euro zone is primarily invested in bonds, largely as a result of regulations. If long-term interest rates remain at their current low level and if the regulations do not change , life insurance in the euro zone will be in great difficulty: client loss es , leading to the need to sell assets at a loss. It will be impossible to change the regulations or to develop new savings products in two or three years. To bolster life insurance in the euro zone, interest rates are therefore going to have to start rising gradually from today. But the euro zone’s cyclical outlook makes this impossible .