The treatment of long-term guarantees (LTG) offered in products such as annuities remains key to the successful implementation and application of Solvency II. It raises questions about market consistent valuation of assets and liabilities and has far reaching implications for long-term investment in the wider economy. This is a complicated problem, which by all accounts, has no simple solution.
In June 2012 a group of leading academics published an article, which acknowledges the case for adjusting the rules, but strongly criticising the underlying principles of the measures under proposal. The Solvency II Wire LTG Symposium brings together authors from the insurance industry, actuarial profession and the regulator to respond to the article and discuss the problem from the point of view of their respective professions.
