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LONDON, May 12 (Reuters) - Legal & General andStandard Life are among insurers most exposed to marketvolatility if there is a vote for Britain to leave the EuropeanUnion and their solvency levels could suffer, ratings agencyMoody's said on Thursday.
"We expect to see volatility in financial markets if the UKvotes to leave the EU, which would weigh on insurers'capitalisation," Moody's said in a report.
The Bank of England is expected later on Thursday toacknowledge the potential for a shock to markets if there is avote for Brexit in a June 23 referendum.
Life insurers are more sensitive to market moves thannon-life insurers, and those with a strong domestic focus aremost exposed to UK financial markets, Moody's said.
Legal & General's solvency ratio would drop to 158 percentif there is a fall in interest rates after a Brexit vote, from169 percent reported at end-December, Moody's estimated.
A ratio above 100 percent shows that an insurer iswell-capitalised, according to new European capital rules, butanalysts want to see higher levels of capital for life insurers,because of their long-term liabilities.
Standard Life, Scottish Widows and Royal London are alsoheavily exposed to UK markets, Moody's said.
Ratings agency Fitch has also highlighted the Brexit vote asa key uncertainty for UK life insurers.
(Reporting by Carolyn Cohn. Editing by Jane Merriman)
