Variable Annuity Issuers Get a Low-Interest-Rate Checkup
December 14, 2021 by Allison Bell
Big U.S. variable annuity issuers look as if they can handle 10 or more years of very low interest rates, according tro results from a new National Association of Insurance Commissioners issuer stress test.
The variable annuity issuers that took the test might need about $8.1 billion in additional reserves, or 15% more, to handle one type of moderately bad interest rate environment, and $6.6 billion in additional reserves, or 12% more, to handle another type of bad environment, according to a results summary prepared by Mike Boerner, an actuary with the Texas Department of Insurance who serves as the working group chair.
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