NBB Insurance Stress Test 2020
Following recent developments related to the Covid-19 pandemic and the subsequent impact on financial markets, the National Bank of Belgium has decided to cancel the 2020 Stress Test Exercise. All groups which have previously been invited to participate in this stress test have also been contacted by the National Bank of Belgium via letter to inform them of this decision.
Objectives
Stress testing is an appropriate tool to identify vulnerabilities of the financial system and to assess the potential impact of risks on the stability of the financial system in general and the insurance sector more specifically. Stress testing also helps to identify those undertakings that may pose a risk to the stability of the financial system or the insurance sector. The National Bank of Belgium (NBB) can, after the analysis of the stress test results, issue recommendations to be implemented by the insurance undertakings in order to contribute to the stability of the financial system.
In 2020, the Belgian insurance sector is subject to a stress test consisting of one scenario (Low yield). The scenario was developed by the NBB and is applied to all Belgian insurance undertakings having life activities.