Changes to fundamental spread help UK insurers, not others
Recalibration of fundamental spread makes little difference to euro volatility adjustment
Changes to a key element of liability discounting under Solvency II will benefit UK insurers but will make little difference to their continental peers, experts say.
The European Insurance and Occupational Pensions Authority (Eiopa) has changed how it calculates the fundamental spread, a component of two adjustments insurers apply under the directive to improve their discounting rate for liabilities – the matching adjustment and volatility adjustment (VA).
On December 7, Eiopa published an
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