Solvency II next steps will have 'huge implications' for annuitants

The European Commission will begin assessing the impact of different approaches to how insurers set reserves and capital for products with long term guarantees, including annuities from 28 January 2013. Deloitte says inappropriate treatment of this could mean insurers have to raise more capital and charge more for annuities - resulting in lower pension payments for consumers. Tasmin Abbey, insurance partner at Deloitte warns while Solvency II will help insurers manage risk, a key "stumbling block" in the negotiations has been the treatment of annuity liabilities. Abbey added: "This...