EU Watchdog Urges Insurers to Address Private Credit Risks
The European Insurance and Occupational Pensions Authority (EIOPA) has emphasized the need for European insurers to understand and manage the risks associated with private credit investments. Petra Hielkema, EIOPA's chair, highlighted the importance of identifying, measuring, managing, and reporting these risks. The shift towards private credit investments has been driven by regulatory changes post-2008 financial crisis, which saw banks reduce their involvement in certain financing activities. Insurers and pension funds have stepped in to fill this gap, benefiting from higher returns on less liquid assets. However, EIOPA stresses the need for robust risk management to maintain trust in the sector. 
