In the light of the current market turmoil, some observers are predicting the eurozone interest rate will fall as low as 1% in 2009. This is 1.25% below the minimum interest rate guarantee for traditional German life business. How would this impact German insurers' asset liability management (ALM) approach?
Johannes Loerper, director at Ergo Group
The current technical interest rate for new policies is indeed 2.25%. However, the average minimum rate is even higher, as we have many active pol