* Current interest rate cut 0.4 pct points to 3.6 pct
* Rival Ergo cut rates by 0.6 pct points
* Allianz says ECB policy weighing on fixed-income rates
(Releads on current interest rate, adds background)
FRANKFURT, Dec 5 Allianz's German unit
will trim the current interest rate it will pay to life
insurance policy holders next year by 0.4 percentage points to
3.6 percent, as rock-bottom capital market interest rates bite.
Other insurers have also announced rate cuts for next year,
reflecting dwindling investment income from government bonds and
other investments in the wake of the financial crisis.
"The accommodative monetary policy adopted by the European
Central Bank for years continues to affect the interest rate
level for fixed-income securities," Allianz said in a statement
The cut in the current interest rate, which applies if the
policy is not held until maturity, is less substantial than the
0.6 percentage point reduction unveiled by rival Ergo
The move brings Allianz's overall 2013 rate of return on
German life insurances to at least 4.2 percent if the policy is
held until maturity, down from 4.5 percent for 2012.
(Reporting by Ludwig Burger and Jonathan Gould; Editing by