By German standards, zinszusatzreserve (ZZR) is not a long word, but the burden it imposes on insurers is great. Since it was first introduced in 2011, the ZZR – the reserves that German life insurers are required to hold against products offering high guarantees – has increased steadily from €1.5 billion (£1.2 billion) to about €13 billion. In 2013 alone, firms are expected to put aside a record €6 billion to build up the buffer.
And with interest rates still at low levels, the burden of the
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