Needham, Mass. — Shockwaves from the upheaval in the U.S. financial system are spreading across borders and causing tectonic shifts in the global financial services landscape, according to Guillermo Kopp, executive director, global research fellow with Needham, Mass.-based TowerGroup Inc. and author of the report, “The TowerGroup Top 10: A Bumpy Flight, Landing, and Takeoff for the Financial Services Industry.”

“The No. 1 business driver: economic, market and regulatory volatility, also dominates the insurance scene,” Kopp tells INN. “Structural concerns on credit and liquidity affect insurance carriers, given that their financial health is highly dependent on their ability to play profitably in capital markets. For example, shockwaves from the U.S. financial turmoil have hit AIG. Even comparatively healthy companies such as ING are using capital injections as a means to stay competitive as the financial services industry undergoes structural change. In the specific field of life and annuity, the insurance industry is hurting from depressed yields in the short term that undermine customer confidence. Besides caring about the intrinsic threats facing the industry, insurance carriers will need to mind the broader financial picture across all markets globally.”

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