Progressive insurers revise approach to sovereign risk

Some supervisors pressing firms to risk weight sovereign bonds


Insurers say repeatedly that capital charges under Solvency II’s standard formula are too high. There is one asset class, though, which both the more conservative of firms and supervisors agree is treated too leniently: sovereign bonds.

Europe’s Solvency II legislation determines that sovereign bonds issued by European Union member states are exempt from capital charges relating to spread and concentration risk. This means that, providing they hedge against interest rate risk, insurers should

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The future of life insurance

As the world constantly evolves and changes, so too does the life insurance industry, which is preparing for a multitude of challenges, particularly in three areas: interest rates, regulatory mandates and technology (software, underwriting tools and…

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