Changes to fundamental spread help UK insurers, not others

Recalibration of part of Solvency II makes little difference to euro volatility adjustment

Eiopa flags
Eiopa: has changed the calculation of the fundamental spread

Changes to a key element of liability discounting under Solvency II will benefit UK insurers but will make little difference to their continental peers, experts say.

The European Insurance and Occupational Pensions Authority (Eiopa) has changed how it calculates the fundamental spread, a component of two adjustments insurers apply under the directive to improve their discounting rate for liabilities – the matching adjustment and volatility adjustment (VA).

On December 7, Eiopa published an updat

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