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Solvency II proposals cause confusion on non-euro extrapolation

A draft of the Solvency II delegated acts circulated informally within the industry suggests the last liquid point for non-euro currencies could shift, making it harder for insurers to hedge long-term liabilities

scandi-currencies

Inconsistencies in the latest draft of the Solvency II delegated acts threaten to undermine how insurers value their long-term liabilities in currencies other than the euro.

Proposed changes by the European Commission could make it harder for insurers to hedge against movements in the risk-free rate curve used to discount non-euro liabilities.

T he latest draft of the delegated acts, which set

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