TITLE
"Hedging a Credited Rate for a Universal Life Policy," Journal of Insurance Issues, Robert E. Hoyt. June 1989, Vol. XII, No. 2, pp. 22-37.

ABSTRACT
A number of companies writing universal life insurance provide a continuation of the current credited rate for premiums received during a certain period. By guaranteeing the credited rate for a certain period the insurance company is exposing itself to interest rate risk. The article provides a discussion and numerical example of how a hedged investment strategy using financial futures can effectively lock in a net earnings spread for the insurance company. This strategy reduces much of the interest rate risk facing the company.