Premiums for the 30 largest European insurers remained virtually flat last year, increasing by just 0.3% to €378.3 billion ($567.63 billion), according to AM Best special report. 

While these insurers reported top line stability, a decrease in net profit of 5.7% to €37 billion ($55.51 billion) reflected challenges to technical margins.

The ratings agency says the European market has become more challenged and concentrated than before with just a few companies expanding profitably and others losing premium and profit share.

The share of the gross written premium (GWP) of the five largest insurers increased marginally but their profits nevertheless climbed from 55.8% to 62.5%.

For example, Zurich experienced a 0.5% reduction in written business but its profitability soared 76.2%. Both Lloyd’s and Chubb showed a decrease in profits with Lloyd’s particularly suffering from adverse currency movements.

AM Best says the biggest change to premium growth for the largest 30 European insurers was experienced by Chubb, whose GWP rose 10.7% to €31.82 billion ($47.73 billion).

Prolonged low interest rates and a period of reserve strengthening following the Ogden table review into injury claims has meant the more stable companies remain focused on protecting their balance sheets.

AM Best expects fewer opportunities and a diminished appetite for mergers and acquisitions.

While it identifies the key Brexit issues as insurers accessing EU business, the broader economic fall-out and regulatory developments, the ratings agency says it does not expect to take any blanket rating actions as a direct consequence of the UK’s withdrawal from the EU.