Market forces: Insurers shiver in cold winds from Germany

Bad news from a couple of German insurers sent tremors through their British counterparts yesterday. Reinsurer Munich Re issued a profit warning it blamed on the turmoil in global markets, while smaller rival Hannover Re said if things did not improve it would be hard pushed to meet its financial targets. This soured sentiment in the whole insurance sector. Legal & General finished 7.1p lower at 98.6p, RSA Insurance Group fell 6.5p to 128.8p, Aviva was down 21.5p at 490p, Prudential dropped 20p to 515.5p and Standard Life ended 6.75p lower at 221.25p. A downbeat note from Merrill Lynch before the results season starting next week did not help, nor did news from Lloyd's of London insurer Beazley that first-half profits had fallen by 25% because of the market conditions hitting its investment income. Over at the banks, HBOS... [read full story]