Insurance Europe has published its concerns over misunderstandings as to how Solvency 2 liabilities are currently calculated, including the discount rates. It clarifies that the Ultimate Forward Rate (UFR) is an input needed to generate interest rate curves which go out to 130 years, and points out that the actual discount rates used to value liabilities for Solvency 2 are far lower than the UFR of 4.2%. Insurance Europe concludes that EIOPA’s current focus on the UFR (see FReD 22 April) is out of context and that any short-term changes would be inappropriate. (Source: Insurance Europe recommends delay of changes to UFR)