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PRA Moves To Clarify Rules For Insurers On Capital Buffers

Law360, London (November 10, 2017, 1:30 PM GMT) -- The U.K. Prudential Regulation Authority moved on Friday to help insurers using complex “matching adjustments” to lower the amount of capital they are required to hold under the European Union’s solvency directive.

Matching adjustment arrangements allow firms to reduce the size of their capital buffers if they can demonstrate that the cash flow from a portfolio of assets is matched to life insurance liabilities. This technique helps firms to meet the toughest capital requirements under Solvency II, the directive which took force across the EU in...
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