Foreign & Colonial is offering guaranteed annuities through a derivative-based service to insurance ...
Foreign & Colonial is offering guaranteed annuities through a derivative-based service to insurance companies looking to avoid another Equitable Life-type debacle. The tailor-made service will effectively neutralise the impact of interest rate movements on guaranteed annuity options in what is designed to be a cheaper and more effective method than used by insurers at the moment. Currently, to match their liabilities insurers generally buy interest rate options which are expensive and limited in supply. This means that there is no real cap on the liability. The uncertainty over guara...
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