On 18 December, EIOPA published its 2018 Annual Report on Long-Term Guarantees Measures (LTG) and Measures on Equity Risk.
https://eiopa.europa.eu/Publications/Reports/2018-12-18 _LTG AnnualReport2018.pdf
The report has been submitted to the European Parliament, Council and Commission.
The 2018 report is structured in four main sections – introduction, overall impact of measures, impact of each measure, thematic focus on risk management.
Insurance Europe analysis
This is the third LTG report and is based on undertaking’s financial position at year-end 2017. Consistent with the 2017 report, it contains an assessment of the overall impact of the LTG package on:
- the financial position of undertakings;
- policyholder protection;
- investment;
- consumers and products;
- competition and level playing field; and
- financial stability.
It also contains a more in-depth analysis of each individual measure and a thematic section on risk management.
The quantitative analysis shows a similar picture to the 2017 report (which is to be expected given the broadly similar economic environment). However, EIOPA has included several new analyses in the 2018 report which may provide an insight into their current work on the 2020 review. These include the impact of the dynamic volatility adjustment, an analysis of the volatility of the RFR curves and further testing of MA portfolios.