PINS S2.2 What is investment risk?

(1) Investment risk is the risk of an adverse movement in the value of an insurer's assets, including off-balance-sheet exposures.
(2) Investment risk includes:
(a) equity risk;
(b) interest rate risk;
(c) foreign exchange risk;
(d) credit risk; and
(e) investment concentration risk.
(3) Because of the nature of insurance business, there is a close relationship between investment risk and asset-liability management risk.
Inserted by QFCRA RM/2013-1 (as from 1st January 2015).