To meet their policyholders’ claims, they could be forced to offload their assets, which might accelerate the fall in bond prices, driving up interest rates even further. This can be more than a merely hypothetical scenario.
Surrender-driven runs on insurance companies have occurred in the past6 In 1997, in the wake of the Asian currency crisis, market interest rates in Korea shot up from just over 12% to around 30% within one year. This saw 3/7  BIS central bankers' speeches  monthly surrender rates for pension products climb as high as 4%.