Annuity Insurance Research Articles

판례 분석을 통한, 즉시연금보험 분쟁의 해결 방안 연구

In the disputes over immediate annuity insurance, the court's judgments of the first and second instances related to the insurer's duty to explain are presented. The disputes began in 2017, and the Financial Supervisory Service's Dispute Mediation Committee recommended that all inherited annuity products(maturity refund type) subscribers pay additional underpaid insurance, but insurers refused to pay collectively except for the mediation case. According to the precedents that consumers have won so far, insurers should specify the risks that “insurers can pay less than the minimum guaranteed rate at the time of the fall in interest rates” and “the monthly pension amount shall be paid after deducting the reserves for financing the maturity refund” in the terms and conditions. In addition, on the basis that the insurance company did not explain this to the customer, the court applied Article 3, Paragraph 4 of Act on the Regulation of Terms and Conditions to invalidate the incorporation into the contents of the insurance contract. Furthermore, the court orders the insurance company to pay the difference to the consumer based on the difference from the minimum guaranteed interest rate or the initial annuity insurance money (the amount without deducting the accumulated amount for the maturity refund fund). In this study, it was considered reasonable to apply Article 102 of the Old Insurance Business Act (current Articles 44 and 45 of Act on the Protection of Financial Consumers) rather than applying Article 3, Paragraph 4 of Act on the Regulation of Terms and Conditions when the insurer violates the duty of explanation. Also, the policyholder's negligence offset can be applied individually, and fairness can be established in accounting for unpaid insurance money. Moreover, in the immediate annuity insurance case, policyholders recognized that the insurer had violated the duty of explanation only after the monthly annuity less than the minimum guaranteed interest rate was paid. The question is whether to view it as the payment date of the monthly annuity of the company or as the time when the existence of the right to claim insurance money was known. In the judgments related to immediate annuity that have been issued so far, the position is that an insurer who refuses to pay insurance loses the lawsuit and that it is unacceptable as an abuse of rights against the principle of good faith that the statute of limitations for claiming insurance has expired. The Supreme Court precedent regarding accidental death benefit considered more emphasis on the pursuit of legal stability, refusing to recognize restrictions based on the principle of good faith, and strictly interpreting the extinctive prescription period. Presumably, the short-term limitation of three years (2 years in most cases subject to immediate annuity) applies to the right to claim insurance money, and it is difficult for general consumers to understand that they must file a claim in court to stop the extinctive prescription period. When the insurer refuses to pay the insurance money, the consumer believes the insurer's words and in most cases gives up on the claim, and even after a court judgment has been issued and the insurance claim is subject to the extinctive prescription period, the claim is frustrated again. Seems to be a very unreasonable result for consumers in. It is necessary to avoid the attitude of omitting key points and not explaining them in detail by delegating specific details to complex and difficult product terms and conditions. I think it's time to listen to the alternative of applying subjective starting points to insurance claims subject to short-term limitation period.

The nexus between investor sophistication and annuity insurance ownership: evidence from FINRA's National Financial Capability Study

PurposeAlthough annuitization provides insurance against longevity risk that can benefit households, researchers have uncovered an annuitization puzzle, which suggests households are reluctant to annuitize their wealth. This study contributes to the discussions on the annuitization puzzle by examining investor sophistication and owning annuities in non-retirement accounts.Design/methodology/approachThe study utilizes data from the 2018 U S National Financial Capability Study (NFCS). The empirical analyses are based on logistic regression estimates of annuity ownership on investor sophistication. Interpretations are based on odds ratios.FindingsThe findings indicate that investor sophistication contributes to the annuity puzzle. Investors with low objective and high subjective investment knowledge (overconfident investors) are more likely to own annuities compared to those with low objective and low subjective investment knowledge. However, investors with high objective and low subjective investment knowledge (under-confident investors) are less likely to choose annuity ownership compared to those with low objective and low subjective investment knowledge. The findings and ensuing discussion highlight the importance of annuitization when planning for retirement, with implications for financial service professionals.Research limitations/implicationsThe measure of investor sophistication does not assess the difficulty level of each financial knowledge question. The questions used to construct the investor sophistication variable are based on general investment knowledge. In addition, the annuity ownership variable used in this study pertains to investments outside retirement accounts. Despite these limitations, the findings highlight the importance of annuitization when planning for retirement.Originality/valueUnlike prior studies, the authors consider four mutually exclusive measures of investor sophistication constructed from measures of objective and subjective investment knowledge to understand the effect of investor sophistication on annuity ownership in the United States.

Pension Security Level of Urban Employees in China Based on CHIPs

In 2019, the Chinese government has put forward comprehensive plan for reducing social insurance premium rate, which will affect the measurement of the pension security level. In order to evaluate the pension level, this paper uses CHIPs data from 1988 to 2018 to calculate “empirical” pension replacement rate by “empirical” method based on different wage calibers. The result shows that the pension replacement rate and income replacement rate of urban employees have gradually declined in the past 30 years. The pension level of nonprivate employees is lower than that of insured employees, and that of insured employees is lower than that of full‐scale employees. The pension level of male, high‐income groups, the older generation, organs, and institutions is much higher than that of female, low‐income groups, the younger generation, and enterprises relatively. Compared with other countries, the pension replacement rate of urban employees in China is not low, but the income replacement rate is relatively low. This paper makes an in‐depth analysis of the actual pension level under the new policy. As a result, it is necessary to vigorously develop multilevel and multipillar pension system such as enterprise annuity, occupational annuity, and commercial pension insurance, so as to improve the pension level of urban employees.

Osnovne karakteristike tontine osiguranja

Tontine insurance is tied to life insurance. This type of insurance is also a type of mutual insurance. However, we must look at tontines separately, having in mind its origin and goal. Tontine insurance originated in the 17th century and was developed in England and the United States, until the beginning of the 20th century, when it became banned. Tontine insurance at an early stage contained elements of group annuity insurance, group life insurance and lottery. Today, tontine insurance is a type of fund within which policyholders, i.e., members, agree to jointly capitalize, i.e., finance their contributions to the fund and to divide the capitalized assets between those policyholders who reach a certain age and the heirs of the deceased insured. The Act on Insurance of the Republic of Serbia also regulates tontine insurance. The author pays attention to the provisions of EU law in this area.

Provision of Longevity Insurance Annuities

Longevity insurance annuities are deferred annuities that begin payment at advanced ages, such as age 82. They provide insurance against running out of money in old age. They simplify the retirement spend-down calculations in that they can be used to convert a problem with an unknown end date (date of death) to one with a fixed end date, which is the start of the longevity insurance annuity. They may allow retirees to have riskier portfolios because they are a steady source of income. In this study, we compared the provision of longevity insurance annuities in the private and public sectors. We analyzed the need for longevity insurance annuities using Monte Carlo simulations that demonstrate the risk of running out of money in a 401(k) account and modeled how longevity annuities might work in practice.

Subscription channels and reasons for insurance according to life insurance and indemnity insurance products through correspondence analysis

본 연구는 보험연구원에서 2018년 실시한 보험소비자설문조사 데이터를 기반으로 생명보험상품과 손해보험 상품별 가입채널과 각 해당 보험상품들에 대한 가입 이유를 시각화 분석방법인 대응분석을 통해 분석하였다. 생명보험 상품들의 가입채널을 보면, 실손의료보험, 종신보험, 변액유니버셜종신, 변액유니버셜연금, 질병보장보험은 주로 설계사 채널과 밀접한 관련이 있으며, 상해보험은 인터넷과 TM, 홈쇼핑 채널들과 관련이 있으며, 변액종신, 어린이보장보험과 정기사망보험은 보험회사 임직원 채널과 관련이 높았다. 저축성보험과 연금보험은 은행과 증권회사 채널과 관련이 높게 나타났다. 반면에 손해보험 상품들의 가입채널을 보면, 실손의료보험, 질병보장보험, 운전자/장해의 장기 상해보험, 간병보험은 설계사 채널과 밀접한 관련이 있으며, 자동차보험은 인터넷 채널과 설계사 채널과 관련성이 높은 것으로 나타났다. 저축성보험은 TM, 보험회사직원, GA와 관련성이 있고 종합보험은 홈쇼핑과 관련이 있는 것으로 나타났다. 생명보험 상품과 손해보험 상품들의 가입 채널을 종합해 보면 주계약과 특약이 포함되어 상품의 특성이 복잡하여 구체적인 설명이 필요한 상품들은 설계사 채널이 선호되었다. 저축성보험과 연금보험은 은행과 증권회사 채널이 선호되었고, 자동차보험과 같이 정형화가 가능한 보험상품은 인터넷 채널이 선호되는 경향을 보였다.This study analyzed the subscription channels for life insurance products and indemnity insurance products and the reasons for subscribing each of the insurance products through the corresponding analysis, a visualization analysis method, based on the insurance consumer survey data conducted in 2018 by the Korea Insurance Research Institute. Looking at the subscription channels of life insurance products, loss medical insurance, whole life insurance, variable universal life insurance, variable universal annuities, and disease coverage insurance are mainly related to the life planner channel, and injury insurance is related to the internet, TM, and home shopping channels. In addition, variable whole life insurance, children s security insurance and term death insurance were related to the insurance company s employee channels. Savings insurance and annuity insurance were highly related to banks and securities companies. On the other hand, if you look at the subscription channels of indemnity life insurance products, loss medical insurance, disease insurance, long-term injury insurance for driver/disability, and care policy are closely related to the life planner channel, and auto insurance is highly related to the internet channel and the life planner channel. Appeared. It was found that savings insurance was related to TM, insurance company employees and GA, and comprehensive insurance was related to home shopping.

An Empirical Study on Residents' Consumption Changes Based on the Development of Commercial Annuity

The relationship between the level of pension insurance development and the consumption of Chinese residents is a topic of constant debate. However, few scholars have analyzed residents' consumption behavior based on the level of commercial annuity development. Using China's 2010-2018 inter-provincial panel data, this article builds a dynamic panel regression model to explore the impact of the development of commercial annuities on household consumption and its structure. In addition, the paper also compares the impact of the protection levels of basic pension insurance and commercial annuity on household consumption. The results show that the per capita disposable income of residents is still the main factor that promotes residents’ consumption. The improvement of commercial annuity and basic endowment insurance will help to promote residents' consumption, and the effect of commercial annuity's promotion on residents' consumption is more significant. In promoting the optimization and upgrading of consumption structure, commercial annuity insurance plays a more significant role than residents' income level and basic pension insurance. Based on the regression results, this article suggests that efforts should be made to increase the income level of residents and promote consumption from the root cause. At the same time, it is necessary to improve the commercial pension insurance system as soon as possible and steadily promote the coordinated development of the "three pillars" pension insurance system.

Rotation of the age pattern of mortality improvements in the European Union

Human mortality tends to decline in the long run, which is fortunate for humans, but less so for pension and health insurance schemes and annuity providers. Empirical studies have shown that rates of mortality improvement depend heavily on the age, gender and country in question, and additionally, they also tend to change in time. More specifically, the historical acceleration of mortality decreases among the elderly and a simultaneous slowdown of improvement at younger ages, which are sometimes jointly referred to as the rotation of the age pattern of mortality decline, have been observed in several populations. After a concise summary of the most relevant literature, this paper suggests a simple, largely data-driven methodology with few assumptions for the empirical examination of the rotation phenomenon in historical mortality datasets. These techniques are then applied on United Nations data from the period between 1950 and 2015 for both genders and all 28 countries of the European Union. The results indicate that rotation has indeed taken place in numerous member states, but its presence is far from universal, and it appears to have been notably more prevalent in populations of women than among men. Life expectancies seem to predict degrees of rotation only in the former Eastern bloc despite prominent literature that suggests otherwise, while increments of life expectancies over the observed period are better predictors of the degrees of rotation in the case of Western European women.

Insurer’s Obligation of Explanation regarding the Deduction of Appropriation for Premium Refund on Expiry of Policy Period from the Financial Resources for Payment of Immediate Annuities

Insurer’s Obligation of Explanation regarding the Deduction of Appropriation for Premium Refund on Expiry of Policy Period from the Financial Resources for Payment of Immediate Annuities

보험금 부지급에 대한 행정제재의 법적 근거와 한계

보험금 부지급에 대한 행정제재의 법적 근거와 한계

How Does Consumption Habit Affect the Household's Demand for Life-Contingent Claims?

This paper examines the impact of habit formation on demand for life-contingent claims in a life-cycle model. We solve the optimal consumption, portfolio choice, and life insurance/annuity problem analytically, and illustrate the mechanism how consumption habit can alter the bequest motive and therefore drive the demand for life-contingent products. We show that habit formation alone can partially address the mismatch in the life insurance market between the life insurance holdings of most households and their underlying financial vulnerabilities, or the mismatch in the annuity market between the lack of any annuitization and the risk of outliving their financial wealth, but not both. However, habit formation together with social security may shed some light on the puzzling thinness of both life insurance and voluntary annuity market.

On age difference in joint lifetime modelling with life insurance annuity applications

AbstractInsurance and annuity products covering several lives require the modelling of the joint distribution of future lifetimes. In the interest of simplifying calculations, it is common in practice to assume that the future lifetimes among a group of people are independent. However, extensive research over the past decades suggests otherwise. In this paper, a copula approach is used to model the dependence between lifetimes within a married couple using data from a large Canadian insurance company. As a novelty, the age difference and the gender of the elder partner are introduced as an argument of the dependence parameter. Maximum likelihood techniques are thus implemented for the parameter estimation. Not only do the results make clear that the correlation decreases with age difference, but also the dependence between the lifetimes is higher when husband is older than wife. A goodness-of-fit procedure is applied in order to assess the validity of the model. Finally, considering several annuity products available on the life insurance market, the paper concludes with practical illustrations.

Вероятность неразорения в коллективной модели пожизненной ренты как вязкостное решение интегродифференциального уравнения

Вероятность неразорения в коллективной модели пожизненной ренты как вязкостное решение интегродифференциального уравнения

연금보험 가입 결정요인에 관한 연구

본 연구의 목적은 재정패널 자료를 활용하여 연금보험 미가입 집단과 가입 집단의 특성을 살펴보고 연금보험 가입에 영향을 미치는 요인을 실증적으로 분석하는데 있다. 본 연구에서는 연금보험 가입의 결정요인을 분석하기 위해 로지스틱모형, 고정효과 패널로지스틱모형, 확률효과 패널로지스틱모형을 적용하였다. Hausman검정을 실시한 결과 고정효과 패널로지스틱모형이 적합한 것으로 나타났다. 고정효과 패널로지스틱모형을 이용하여 연금보험 가입 결정요인을 분석한 결과, 연령이 높을수록, 중간 정도의 연령일수록, 교육기간이 증가할수록, 가구원이 적을수록, 임금근로자가 아닐수록, 소득 및 부동산자산의 증가율이 높을수록, 퇴직급여 대상일수록, 보장성보험에 가입할수록, 저축성보험에 가입하지 않을수록 연금보험미가입 대비 가입의 오즈비가 1보다 크게 나타났다. 이러한 결과는 노후준비를 위한 시간 또는 금전적 여유가 상대적으로 부족한 베이비부머 등 중고령자와 가구원이 많은 저소득층의 연금보험 가입을 지원할 필요가 있음을 시사하였다.

Solvency II solvency capital requirement for life insurance companies based on expected shortfall

This paper examines the consequences for a life annuity insurance company if the solvency II solvency capital requirements (SCR) are calibrated based on expected shortfall (ES) instead of value-at-risk (VaR). We focus on the risk modules of the SCRs for the three risk classes equity risk, interest rate risk and longevity risk. The stress scenarios are determined using the calibration method proposed by EIOPA in 2014. We apply the stress-scenarios for these three risk classes to a fictitious life annuity insurance company. We find that for EIOPA’s current quantile 99.5% of the VaR, the stress scenarios of the various risk classes based on ES are close to the stress scenarios based on VaR. Might EIOPA choose to calibrate the stress scenarios on a smaller quantile, the longevity SCR is relatively larger and the equity SCR is relatively smaller if ES is used instead of VaR. We derive the same conclusion if stress scenarios are determined with empirical stress scenarios.

Legacy Savings Organizations: Beating Deferred Annuity Insurance Benefits by Over 50%; Practical Plan for Funding Extra-Long Retirement

Longevity insurance pays cash benefits to an insured individual who attains a defined age. Thereafter, benefits may continue throughout the insured’s life. For anyone concerned that living too long might become an economic hardship, longevity insurance, at the right price, can make sense. Yet, due to cost, few people purchase it. Longevity insurance’s high price reflects three factors: 1) lingering effects of a 1905 government investigation which pushed the insurance industry to bundle costly, counterproductive features with its longevity products, 2) the corporate structure of the underwriting business which shoulders risk, requires remuneration and itself interposes an additional risk factor (potential insurer default) and, 3) most importantly, inequitable taxation. A legacy savings organization (LSO) is an organizational structure that enables a group of individuals to self-insure far more cost effectively and at lower risk than through a commercial insurer. For instance, through such an organization, a typical 65 year old man, in return for a $100,000 payment placed in risk-free Treasury securities, could expect to receive beginning at age 85 roughly a $50,000 annual, after tax benefit, easily 50% more than most commercial insurers now offer. Today, commercial insurers are engines that turn the principal of one insured into the taxable income of another. An LSO avoids this onerous tax treatment. This report briefly reviews current, commercially available longevity insurance products, describes the construction and delivery of a more attractive alternative through LSO’s and briefly relates the history of similar alternatives.

Converting Retirement Benefit into a Life Care Annuity with Graded Benefits: How Costly Would it Actually Be?

This paper deals with life care annuities, i.e. bundled products comprising a life annuity and long-term care insurance. It aims to assess the cost of converting retirement benefit into a life care annuity with graded benefits using a pre-existing public pay-as-you-go pension scheme. With this objective in mind, we present an actuarial method based on array calculus for valuing this type of life care annuity. The health dynamics of the annuitant rely on a reversible illness-death multistate framework. The paper contains a numerical example in which mortality and disability assumptions are based on data from the USA and Australia, although this should be viewed simply as an illustration. In addition, in order to check the coherence of these data, we compute life expectancy for both healthy and dependent persons, and then for dependent persons in each of the states of dependence. The effect of ruling out the recovery assumption on the annuity's cost is also assessed. The analysis provides valuable insights into how much it would cost to introduce these annuities and enables us to make some policy recommendations to help ensure that this combined pension scheme has a good actuarial design. If the data used were the real data, it would be no exaggeration to say that embedding long-term care coverage into the retirement system in the USA might not be very costly, whereas for Australia the opposite would be true.

Welfare Effects of a Reverse Life Insurance Annuity in an Overlapping Generations Model

Welfare Effects of a Reverse Life Insurance Annuity in an Overlapping Generations Model

Logistic Regression for Insured Mortality Experience Studies

Properly adapted statistical modeling methodology can be a powerful tool for coping with a broad range of challenges related to life and annuity insurance industries' experience studies. In this article, we present a logistic regression model based on U.S. insured mortality experience study with a focus on gaining study efficiency and effectiveness by addressing multiple analytical predicaments within one statistical modeling framework. These predicaments include but are not limited to (a) testing statistical significances or credibility of potential mortality drivers, (b) estimation of normalized mortality, slopes, and differentials, (c) quantification of study reliability, and (d) extrapolation for under-experienced mortality, smoothing between select and ultimate estimations, and development of basic experience tables.

(Purchase Decision, Amount, and Purchase Intention of Individual Annuity)

Korean Abstarct: 본 연구에서는 개인연금 가입현황과 보유특성을 살펴보고, 개인연금 가입결정과 납입액 규모에 영향을 미치는 요인을 2단계 선택모형으로 분석하였다. 개인연금 가입유형을 연금저축과 연금보험으로 구분하여 분석하였고, 개인연금 미가입자를 대상으로 가입의향에 영향을 미치는 요인을 파악하였다. 전국의 만 20세-59세 성인남녀를 대상으로 온라인 설문조사를 시행하였으며, 총 460부의 자료를 최종 분석에 사용하였다. 본 연구의 주요 결과는 다음과 같다. 첫째, 공적연금 가입가계가 90%인데 반해, 퇴직연금 가입가계는 37%, 개인연금 가입가계는 55%로 나타났으며, 1,2,3층의 공적, 퇴직, 개인연금에 모두 가입한 가계는 24%에 불과했다. 개인연금 가입가계 중에서는 연금저축(세제적격)에 가입한 가계가 연금보험(세제비적격)에 가입한 가계의 2배 이상이었다. 연금저축과 연금보험에 둘 다 가입한 가계는 각 연금상품에 평균 이상의 금액을 납입하는 것으로 나타났고, 가입기간 역시 각각의 연금상픔 보다 긴 것으로 나타났다. 둘째, 개인연금 가입결정과 연간납입액 규모에 영향을 미치는 요인을 분석한 결과, 배우자가 있고, 자영업자, 사무직이고, 자가를 보유하고, 월평균가계소득이 높을수록, 공적연금, 퇴직연금에 가입하고, 은퇴 후 희망하는 경제수준이 높을수록 개인연금 가입 가능성이 높아졌고, 노후준비수단으로 금융자산과 부동산을 보유한 가계는 개인연금 가입 가능성이 낮았다. 또한 개인연금 가입가계 중에서는 여성, 배우자 있는 가계, 대졸이상, 중소도시, 읍면부 거주가계, 공적연금 미가입 가계가 개인연금 연간납입액이 많은 것으로 나타났다. 셋째, 개인연금 미가입자의 53%는 향후 개인연금에 가입할 의향이 있는 것으로 나타났다. 개인연금에 가입하지 않은 이유가 연금납입액의 경제적 부담 때문일 경우에는 향후 개인연금에 가입할 의향이 낮았지만, 미가입 이유가 개인연금상품 정보 부족 때문일 경우에는 개인연금 가입의향이 높은 것으로 나타났다. English Abstract: The purpose of this study was to analyze the factors affecting the purchase decision and amount of individual annuities by using Heckman's two-step estimation models. A special attention was paid to the type of annuities, such as annuity saving with tax credit and annuity insurance without tax credit. This study also analyzed purchase intention of individual annuities for those who do not have any annuity. The online survey results from the 460 respondents, aged between 20 and 59, are as follows. About 90% of households had public pension, 37% of them had retirement pension, and 55% of households had individual annuities. Those who had multi-pillar pension system were about 24%. Those who owned annuity savings were more than those who owned annuity insurances. The households which had both annuity savings and annuity insurances had higher level of annual amount of payment and longer periods of annuity holdings. Those who were married, self-employed, office workers, high income earners, and home owners were more likely to have public pension and individual annuities. In addition, those who possessed financial assets and real estates for the retirement planning were less likely to have individual annuities. Household's income, asset holdings, education level, public pension had generally positive impacts on the amount of annual payment of annuities, while ownership of real estates for retirement planning appeared to decrease the probability of annuity holdings. About 53% of respondents who did not have individual annuity had intention of annuity purchase. Those who did not have annuity because of economic burden were not likely to purchase individual annuity. However, those whose reason was due to lack of information were likely to purchase individual annuity.