The insurance industry has been underpricing variable annuities - a particular problem in Asia, where a shortage of long-dated bonds makes it difficult to hedge their liabilities, according to a senior insurance official speaking at the Asia Risk Congress 2010 in Hong Kong on November 16.
"[Variable annuities are] essentially providing guarantees - quite often exotic guarantees - on mutual fund investment... we try to guarantee that you get at least your money back at the end, or even better. On
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