Insurers Shrug Off Euro's Woes.The relentless fall of the euro has shaken money markets, but seems to be having little effect on the bottom line for insurers whose business crosses the Atlantic.
European insurers that do a lot of business in dollars are getting a boost to their earnings when those premiums are translated back into euros, the new common currency of the European Union European Union (EU), name given since the ratification (Nov., 1993) of the Treaty of European Union, or Maastricht Treaty, to the
European Community . Conversely, claims payments in dollars take a bigger bite out Verb 1. bite out - utter; "She bit out a curse"
let loose, let out, utter, emit - express audibly; utter sounds (not necessarily words); "She let out a big heavy sigh"; "He uttered strange sounds that nobody could understand" of underwriting results. U.S. insurers, meanwhile, face an opposite effect when their euro-dominated policies are converted into dollars.
But equity analysts have said the euro's woes aren't weighing heavily on insurers from either side of the Atlantic. It's a greater problem for manufacturing companies than for insurers, analysts agreed.
Andrew Ritchie, an analyst with Fox-Pitt, Kelton in London, said the weak euro could have a hypothetical effect on European insurers' expansion plans in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. , but in practice that doesn't seem to be the case. The currency's fall against the dollar "doesn't seem to be affecting the corporate calendar," Ritchie said.
U.S. insurers are seeing similarly muted effects on their European business, said Michael Lewis Michael Lewis or Mick Lewis may refer to:
UBS United Bible Societies
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UBS Universal Building Society (UK)
UBS Ulaanbaatar Broadcasting System Warburg in New York New York, state, United States
New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of . He said companies, such as Chubb Corp., are seeing some effect on their premiums but not on earnings.
"The bottom-line effect is not that big," said Simon Foessmeier, an analyst with Bank Julius Baer in Frankfurt, Germany.