Normally, low interest rates portend fortuitous economic and business conditions. Well, these are not normal economic times.

With the Federal Discount Rate mired at .75 percent and little indication from Federal Reserve Chairman Ben Bernanke that this is going to change anytime soon, a host of challenges present themselves to purveyors of interest rate-sensitive products. For starters, with living benefits becoming an increasing part of variable annuity offerings, low interest rates drive up the cost of providing that guarantee. Low interest rates also drive up the cost of dynamic hedging.

Register or login for access to this item and much more

All Digital Insurance content is archived after seven days.

Community members receive:
  • All recent and archived articles
  • Conference offers and updates
  • A full menu of enewsletter options
  • Web seminars, white papers, ebooks

Don't have an account? Register for Free Unlimited Access