Variable Annuities - Axa injects $3bn into US arm


On November 25, French insurer Axa Group announced a $3 billion capital injection into its US subsidiary Axa Financial to bolster its solvency. One factor in this decision was variable annuity (VA) hedging losses projected at between EUR350 million and EUR450 million for the fourth quarter of 2008, and EUR500 million to EUR600 million for the full year. Third-quarter hedging losses on VAs totalled EUR123 million, with a further EUR32 million loss in deferred acquisition costs (DACs). The project