Abstract
U.S. and German life insurers offer similar products, except for different penalties to withdraw funds. We identify market value reductions (MVR), which are common in the U.S. and prevented by law in Germany, as a main instrument to manage liquidity risk in the industry. It turns out that German life insurers may ultimately be at risk of experiencing a policyholder run if interest rates hike strongly. Based on a unique set of regulatory panel data from 2005 to 2014, we show that this risk has increased over the course of the financial and sovereign debt crisis.
Full Text 
Sign-in/Register to access full text options
Sign-in/Register to access full text options 
Published version (
Free)
Free) 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
