Discretionary Decisions in Capital Requirements under Solvency II
#insurers have discretion to determine #solvencyii #capitalrequirements. We find that long‑term guarantees measures substantially influence the reported solvency ratios. The measures are chosen particularly by less solvent insurers and firms with high interest rate and credit spread sensitivities. Internal #models are used more frequently by large insurers and especially for #risks for which the firms have already found adequate immunization strategies.