The insurance industry hasn’t often had to face problems with declining capacity, underwriting losses and falling equity returns all at the same time. Now it is being watched with interest by investors. European insurers in particular are beginning to feel exposed to the winds of change. For example, last week a big surge in the value of the US dollar against the Euro saw some US companies sell European stocks down, causing a significant decline in the share price of European insurers.

British giant Prudential dropped 8.6%, Axa fell 8.5% and Dutch insurer Aegon was down 8%.