The past financial year was never going to be easy for life insurers. Tough economic times had already led to a spike in disability claims. Increases in lapsed and surrendered policies had a devastating effect not just on earnings, but also on actuarial valuations. Ultimately, it is these valuations that drive their share prices. But at least, shareholders thought, there hadn’t been any profit warnings. Then last week, Liberty Holdings revealed its dire straits, warning that headline earnings for 2016 would be between 40% and 60% lower than 2015.
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