German life poo

Europe

Falling equity prices have prompted German insurers, including Munich Re and Allianz, to support a pool to bail out struggling life companies. German life insurers offer a 3.25% guaranteed return plus bonuses to policy holders. Many companies, including Allianz, have indicated that they will be forced to cut bonuses to policy holders this year. Industry analysts anticipate that many smaller German companies will be forced to seek a merger with financially stronger rivals. The pool will support insurers unable to pay guaranteed returns to policy holders at the end of this year. The industry will release details of the pool next week. German equity prices have fallen by an average of 32% since the beginning of this year.