Some insurers operating in the United States stand to reap a windfall worth hundreds of millions of dollars from the relaxing of a 31-year-old rule on reporting interest rate-related losses, a Reuters review of regulatory filings and interviews with executives and analysts show.
Following the rule change, insurers will be allowed to amortize interest rate-related losses over time equivalent to 10% of their statutory surplus. The statutory surplus is the difference between insurers' assets and liabilities, money that can be used to pay policyholders in unforeseen circumstances.
The new regime has some safeguards. A key metric of an insurer's financial health, its risk-based capital ratio, would have to be at least 300% after adjustments to be allowed to defer interest rate-related losses. Prudential would have been able to reverse about $1.3 billion of $1.8 billion in bond losses last year had the new rules been in place, Chief Financial Officer Ken Tanji told analysts on the company's second-quarter earnings call.
The change will also increase Prudential's risk-based capital ratio to 409% from 383%, according to an SEC filing. Staying close to the 400% threshold is a target many insurers seek to achieve a better credit rating.
, which has "very little" negative IMR, would see little immediate financial impact from the change but would be able to be more flexible with its hedging program when it comes to accepting losses, chief financial officer Steven Zabel told analysts on August 2.
France Dernières Nouvelles, France Actualités
Similar News:Vous pouvez également lire des articles d'actualité similaires à celui-ci que nous avons collectés auprès d'autres sources d'information.
Insurers won't cover new Alzheimer's treatment for some customersSome private insurers are balking at paying for the first drug fully approved to slow mental decline in Alzheimer’s patients.
Lire la suite »
Some insurers won't cover new Alzheimer's treatment shown to slow declineSome private insurers are balking at paying for the first drug fully approved to slow mental decline in Alzheimer’s patients.
Lire la suite »
Insurers won't cover new Alzheimer's treatment for some customersInsurers selling coverage in North Carolina, Pennsylvania and New York, among other states, told The Associated Press they won’t cover Leqembi with insurance offered on the individual market and through employers because they still see the $26,000-a-year drug as experimental. The federal coverage program mainly for people ages 65 and older announced shortly after Leqembi received full approval last month that it will cover the treatment while still tracking its safety and effectiveness. Leqembi is the first medicine that’s been convincingly shown to slow the cognitive decline caused by Alzheimer’s disease, though only modestly.
Lire la suite »
China urges banks, insurers to step up support for flood-stricken firmsChina is pushing banks and insurers to step up support to flood and disaster-stricken companies and business owners to speed up their return to normal operations, its financial regulator said in a circular on Monday.
Lire la suite »
WWE SmackDown Sees Rey Mysterio Win United States ChampionshipAfter AustinTheory injured the LWO's SantosEscobar, ReyMysterio took his place and beat Theory for the UnitedStatesChampionship on tonight's edition of FOXTV's WWE SmackDown. / WWESmackDown
Lire la suite »