Swedish Solvency II discount rate move 'must address sensitivity concerns'

Extrapolation methodology must be robust and allow insurers to manage solvency positions, says Insurance Sweden

The Swedish financial regulator should use an extrapolation methodology that reduces interest rate sensitivity at the last liquid point when it puts forward its proposals for implementing a Solvency II-based discount rate in 2014, the Swedish insurance industry has urged.

Finansinspektionen announced last week that it would introduce Solvency II's discount rate methodology for calculating the value of life insurance and pension fund liabilities next year. It plans to consult on the design of the