Insurers look to volatility controls to support long-term guarantees

Lion taming

In the current ultra-low interest rate environment, insurers are grappling with the question of what, if any, long-term guarantees can be offered to customers. In recent years, some insurers have been badly burned by products promising guarantees that were impossible to meet when markets tanked. Aegon’s ‘Five for Life’ variable annuity (VA) was one such product, a package that pledged to pay out 5% of a policyholder’s initial investment each year from the age of 60 until death. Launched in 2006,

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