Insurance Value Research Articles

Modelling the potential impact of a tax on fruit juice in South Africa: implications for the primary prevention of type 2 diabetes and health financing

BackgroundSouth Africa is experiencing a persistent growth in non-communicable diseases. Diabetes is among the top ten causes of mortality, especially among women, which is partly driven by high levels of added sugar consumption and obesity. To reduce obesity rates and the incidence of diabetes, South Africa introduced a tax on sugar sweetened beverages (also known as the Health Promotion Levy (HPL)) in 2018. The tax is applicable to sugar-sweetened beverages but excludes 100% fruit juice. The government is currently considering extending the tax to include fruit juices. This study models the potential health and economic impact of taxing fruit juices at 20% of the retail price of one liter.MethodsTo analyze the distributional impact of the tax, this study uses extended cost-effectiveness analysis methodology. Data on price elasticities, healthcare cost, income, fruit juice consumption were sourced from the literature and representative national surveys. The potential impact of the tax on diabetes incidence, prevalence, mortality, and financial benefits were estimated for each income group (lowest, quintile 1 to highest, quintile 5).FindingsWe estimate that a 20% tax on fruit juice would avert 156,640 incident cases of type 2 diabetes mellitus over 20 years, with most disease averted occurring among the first- and fifth-income groups. Averted deaths from diabetes would average 2,000 deaths per quintile (for quintiles 1 to 4) and about 2,800 in quintile 5. The improved health resulting from averted incidence and deaths will reduce overall healthcare expenditure by R7.5 billion over 20 years, of which R2.3 billion will occur in the fifth quintile. The South African government will also save about R300 million in subsidizing diabetes-related healthcare cost as a result of prevention; and would raise R8.6 billion in tax revenues per annum. Out-of-pocket expenditure savings will be R303 million and a financial risk protection (money-metric value of insurance) of R4.6 billion over the 20-year period.ConclusionWe conclude that an HPL that significantly raises the retail price of fruit juices would reduce consumption and diabetes-related morbidity and mortality. The tax will also provide significant financial benefits in the form of reduced healthcare costs for both government and households as well as providing financial risk protection to individuals. Health taxes are win-win policies that improve population health and generate revenue for governments to fund public health services delivery and thus improve overall health financing activities of the government. Therefore, population level disease prevention measures such as health taxes are important for achieving universal health coverage.

Hybrid life insurance valuation based on a new standard deviation premium principle in a stochastic interest rate framework

Hybrid life insurance valuation based on a new standard deviation premium principle in a stochastic interest rate framework

Determinants of life insurance purchase decisions among university students in Hanoi, Vietnam

This article aims to evaluate the factors affecting the decision to buy life insurance for students in Hanoi, including the variables: awareness of life insurance value, motivations to purchase, barriers to purchase, company brand, and life insurance consultant. A quantitative survey was utilized to take the students in Hanoi, Vietnam. The study uses SPSS 20 analysis software based on 351 valid responses. The multiple regression results show that all of these factors have significant effects. Accordingly, the barrier factor has a negative impact, decreasing the ability to buy life insurance. In contrast, other factors have a positive impact, such as exceptionally high awareness of value and purchase motivation, which have the most substantial impact. Consultants and company brands also promote students’ decision to buy life insurance. Insurance companies should focus on education, improving services, and building brands to increase the ability to purchase life insurance for students. In addition, raising awareness of the value of life insurance is also necessary for student customers. The findings suggest that targeted strategies addressing these key factors can effectively boost students' adoption of life insurance in Hanoi and Vietnam.

Salvaging Art Collections in the Face of Natural Disasters: Challenges and Outcomes

ABSTRACT A case study describes the impact on a collection of the extreme floods in eastern Australia in February 2022, and the salvaging of the Lismore Regional Art Gallery art collection. Despite predetermined protocols and preparedness efforts, the gallery suffered unprecedented flooding, requiring coordinated solutions to support emergency recovery. The project included relocating and stabilising around 1400 artworks, divided between the permanent collection and temporary exhibitions. Coordinated collaboration with stakeholders was needed to determine which artworks were salvageable; initial assessments indicated 60%. However, after further assessment this was reduced to 40% of all artworks able to be returned to a condition suitable for storage and display. The paper focuses on the assessment criteria used to prioritise artworks for salvage and conservation: insurance value, condition post-flooding, the views of living artists on display of treated works, and sentimental and community importance. It also outlines the conservation processes for flood-damaged paintings on canvas, works on paper, and photographgraphs, highlighting challenges and outcomes.

International practice of the bonus-malus system

Purpose of the research – evaluation of the eff ectiveness of the "bonus-malus" in the class of compulsory insurance of civil liability of vehicle owners and the identification of the conceptual foundations of compulsory insurance of civil liability inherent in the experience of foreign countries, as well as the development of proposals to improve the rules of this insurance. Methodology – the methodological basis of the research was the works and publications of foreign economic scientists, a set of general scientifi c and private methods of scientific cognition (analytical, systematic method, analysis, synthesis, comparison, etc.). Originality / value – in order to ensure a balance with favorable values of compulsory civil liability insurance, methodological approaches to the modernization of the bonus-malus system are provided and determined by the expediency and possibility of use in the insurance market of kazakhstan. Findings – it provides for the use of optimal ways of differentiating insurance tariff s by domestic insurance companies, taking into account the degree of risk and interests of policyholders of various categories, and maintaining the availability of tariffs for a wide range of consumers of insurance services.

Quantifying the insurance value for rare diseases: Duchenne muscular dystrophy.

To quantify the magnitude of an ISPOR novel value element, insurance value, as applied to new treatments for a rare, severe disease with pediatric onset: Duchenne muscular dystrophy (DMD). Prospective survey of individuals planning to have children in the future. A survey was administered to US adults (aged ≥ 21 years) planning to have a child in the future to elicit willingness to pay (WTP) for insurance coverage for a new hypothetical DMD treatment that improved mortality and morbidity relative to the current standard of care. To identify an indifference point between status quo insurance and insurance with additional cost that would cover the treatment if respondents had a child with DMD, a multiple random staircase design was used. Insurance value-the value individuals receive from a reduction in future health risks-was calculated as the difference between respondent's WTP and what a risk-neutral individual would pay. The risk-neutral value was the product of the (1)probability of having a child with DMD (decision weighted), (2) quality-adjusted life-years (QALYs) gained from the new treatment, and (3) WTP per QALY. Among 207 respondents, 80.2% (n = 166) were aged 25 to 44 years, and 59.9% (n = 124) were women. WTP for insurance coverage of the hypothetical treatment was $973 annually, whereas the decision-weighted risk-neutral value was $452 per year. Thus, insurance value constituted 53.5% ($520) of value for new DMD treatments. Individuals planning to have children in the future are willing to pay more for insurance coverage of novel DMD treatments than is assumed under risk-neutral, QALY-based frameworks.

The Principle of Proportion under Property Insurance Contract. A Gloss to the Judgment of the Supreme Court of 17March, 2023 (II CSKP 681/22)

The subject of this gloss is the judgment of the Supreme Court of March 17, 2023 (II CSKP 681/22), which discusses the principle of proportion in the event of underinsurance (i.e. when the sum insured is less than the insurance value). The Supreme Court once again had the opportunity to comment on the admissibility of including clauses of the principle of proportion in insurance contracts (concluded in B2B transactions, i.e. with the participation of entrepreneurs). This gloss is an attempt to develop the theses presented in the statement of reasons of the judgment, which deserve approval.

EE474 Value Assessment Under Uncertainty: Measuring Insurance Value and Risk Aversion for a Novel Neurological Treatment Using a Stated Preference Survey

EE474 Value Assessment Under Uncertainty: Measuring Insurance Value and Risk Aversion for a Novel Neurological Treatment Using a Stated Preference Survey

SPOUSAL LABOR SUPPLY, CAREGIVING, AND THE VALUE OF DISABILITY INSURANCE

AbstractThis article evaluates the insurance value of the Social Security Disability Insurance (SSDI) program among married households when wives face a trade‐off between market hours and spousal care following their husbands' disability. Event study analyses show that wives' labor supply responses to their husbands' disability are small, and instead, a considerable amount of time is spent in spousal care. Using a dynamic structural model, I find that incorporating time loss due to spousal care increases the insurance value of SSDI relative to its costs. Finally, budget‐neutral policy reforms that subsidize the cost of care can improve social welfare.

ANALISIS PREMI TAHUNAN INDIVIDU DENGAN MANFAAT YANG DIBAYARKAN PADA AKHIR TAHUN KEMATIAN

Life insurance is an insurance product that provides guarantees in the form of benefits to the insured's family if the insured dies in the future. The amount of this benefit is influenced by the amount of the annual premium paid by the insurer to the insured. The researcher will calculate the amount of the individual's annual premium on endowment insurance. The researcher will use a fixed interest rate to calculate the discount factor and the Gompertz distribution approach to calculate the insurer's chance of survival. Previously, the researcher will estimate the Gompertz distribution parameters using the Maximum Likelihood Method (MLE) based on the 2011 Indonesian Mortality Table (female). Furthermore, the researcher will calculate the insurer's chance of survival using the Gompertz distribution to obtain the actuarial present value of the initial term annuity and the actuarial present value of the endowment life insurance. In addition, the researcher will calculate the comparison of the present value of the endowment life insurance to the present value of the life annuity. The last step is that the researcher will multiply the comparison of this present value by the benefits received to calculate the amount of the individual's annual premium. The calculation results show that the comparison of the present value of dual-purpose life insurance to the present value of a living annuity is getting smaller as the policy coverage period increases. As a result, the amount of the individual's annual premium will also be smaller. This shows that the amount of the annual premium is influenced by interest rate factors, the insurer's life chances, and the length of the coverage period.

Value of loan credit insurance in the capital-constrained supply chain

Value of loan credit insurance in the capital-constrained supply chain

How Financial Literacy Impacts Financial Well-Being: The Influence of Financial and Technical Efficacy

The fundamental human resource that influences financial well-being is financial literacy. People are more likely to save and invest if they understand the time value of money, credit, insurance, and investments. Having a sound financial understanding lessens stress and increases financial well-being. This study used a structured survey questionnaire and back-translated it into Bangla to ease readability for the respondents. Four hundred thirty-five invitations were sent mainly to the Dhaka city dwellers’ and only 253 complete responses were retained for analysis. Partial least squares structural equation modeling (PLS-SEM) is used to assess the intercorrelations and validate the measurement model among the constructs (financial attitude, behavior, knowledge, self-efficacy, technological self-efficacy, and financial well-being) using SmartPLS version 4. The result found a full mediation effect among financial behavior, financial self-efficacy, and financial well-being. Partial mediation effects are found among financial attitudes toward financial self-efficacy, technological self-efficacy, and financial well-being.

The Value and Limits of Unemployment Insurance

The Value and Limits of Unemployment Insurance

Risk management opportunities in auto insurance: A focus on the value of vehicles

AbstractRatemaking and risk‐based pricing revolve around the value at risk, involving a tendency of higher values implying higher premiums. Traditionally, vehicle values are set at “list price” and depreciate over time on a one‐size‐fits‐all factor model. If values change over time, so should premiums, but a single factor table that only goes downward to flat is out of sorts with today. In today's transactional data streams, vehicle features, and values can be easily observed—of note, a shift in product mix that has more options and higher retained values creates a gap in actual versus traditionally expected insurance values. This gap most acutely appears at the vehicle “as built” level, which is more granular than current segmentation levels of insurance ratemaking vehicle valuation analysis. The result is leaving companies to simply raise base rates universally until they can adapt more flexible price‐to‐value methods at an “as built” price accuracy sophistication level.

Fair valuations of insurance policies under multiple risk factors: A flexible lattice approach

AbstractWe propose a flexible lattice model to evaluate the fair value of insurance contracts embedding both financial and actuarial risk factors. Flexibility relies on the ability of the model to manage different specifications of the correlated processes governing interest rate, mortality, and fund dynamics, thus allowing the insurer to make the most appropriate choices. The model is also able to handle additional guarantees like a surrender opportunity for which explicit formulae are not available being it similar to an American derivative. The model discretizes mortality and interest rate dynamics through two different binomial lattices and then combines them into a bivariate tree characterized by the presence of four branches for each node. The probability of each branch is defined to replicate the correlation affecting the two processes. The bivariate model is useful to compute the value of survival zero coupon bond. When adding another source of risk, such as the fund dynamics for evaluating fund-linked insurance products, we model it through a bivariate tree that captures the influence of the interest rate on its drift term. Then, the mortality risk is embedded by defining a trivariate tree presenting eight branches emanating from each node with probabilities defined in order to capture the correlations of the processes. Extensive numerical experiments assess the model accuracy by considering some stylized policies, but the model application is not limited to them being it able to manage different contract specifications.

Relative predictive value of sociodemographic factors for chronic diseases among All of Us participants: a descriptive analysis

BackgroundAlthough sociodemographic characteristics are associated with health disparities, the relative predictive value of different social and demographic factors remains largely unknown. This study aimed to describe the sociodemographic characteristics of All of Us participants and evaluate the predictive value of each factor for chronic diseases associated with high morbidity and mortality.MethodsWe performed a cross-sectional analysis using de-identified survey data from the All of Us Research Program, which has collected social, demographic, and health information from adults living in the United States since May 2018. Sociodemographic data included self-reported age, sex, gender, sexual orientation, race/ethnicity, income, education, health insurance, primary care provider (PCP) status, and health literacy scores. We analyzed the self-reported prevalence of hypertension, coronary artery disease, any cancer, skin cancer, lung disease, diabetes, obesity, and chronic kidney disease. Finally, we assessed the relative importance of each sociodemographic factor for predicting each chronic disease using the adequacy index for each predictor from logistic regression.ResultsAmong the 372,050 participants in this analysis, the median age was 53 years, 59.8% reported female sex, and the most common racial/ethnic categories were White (54.0%), Black (19.9%), and Hispanic/Latino (16.7%). Participants who identified as Asian, Middle Eastern/North African, and White were the most likely to report annual incomes greater than $200,000, advanced degrees, and employer or union insurance, while participants who identified as Black, Hispanic, and Native Hawaiian/Pacific Islander were the most likely to report annual incomes less than $10,000, less than a high school education, and Medicaid insurance. We found that age was most predictive of hypertension, coronary artery disease, any cancer, skin cancer, diabetes, obesity, and chronic kidney disease. Insurance type was most predictive of lung disease. Notably, no two health conditions had the same order of importance for sociodemographic factors.ConclusionsAge was the best predictor for the assessed chronic diseases, but the relative predictive value of income, education, health insurance, PCP status, race/ethnicity, and sexual orientation was highly variable across health conditions. Identifying the sociodemographic groups with the largest disparities in a specific disease can guide future interventions to promote health equity.

Incorporating Real Option Value in Valuing Innovation: A Way Forward.

Considerable progress has been made in defining and measuring the real option value (ROV) of medical technologies. However, questions remain on how to estimate (1) ROV outside of life-extending oncology interventions; (2) the impact of ROV on costs and cost effectiveness; and (3) potential interactions between ROV and other elements of value. We developed a 'minimal modeling' approach for estimating the size of ROV that does not require constructing a full, formal cost-effectiveness model. We proposed a qualitative approach to assessing the level of uncertainty in the ROV estimate. We examined the potential impact of ROV on the incremental cost-effectiveness ratio as well as on the potential interactions between ROV and other elements of value. Lastly, we developed and presented a 15-item checklist for reporting ROV in value assessment. The minimal modeling approach uses estimates on the efficacy of current treatment and potential future innovation, as well as success rate and length of new treatment development, and can be applied to all types of ROV across disease areas. ROV may interact with the conventional value, value of hope, productivity effects, and insurance value. The impact of ROV on cost effectiveness can be evaluated via threshold analysis. The minimal modeling approach and the checklist developed in this paper simplifies and standardizes the estimation and reporting of ROV in value assessment. Systematically including and reporting ROV in value assessment will minimize bias and improve transparency, which will help improve the credibility of ROV research and acceptance by stakeholders.

Impact of post-disaster federal assistance on the national flood insurance program

This research tested the hypothesis that post-disaster federal relief program crowds out the demand for flood insurance in the U.S. To do that, this research has collected historical data between 2016 and 2020, and conducted propensity score-based analysis to understand the causality between post-disaster federal assistance and flood insurance enrollment in the flood affected counties in the U.S. In the first part, the treatment variable has been considered as binary to compare the effect of the availability of federal assistance to that of non-availability of federal assistance in a flood affected county by using propensity score matching method. It was found that the availability of the federal payout in a county in a year increased the number of flood insurance policies by 5.2 % and the total insured value of the policies by 4.6 % in the following year. Next, the treatment variable was considered continuous and was used in a generalized propensity score method to develop a dose response function, i.e., a function that depicts the changes in the outcome variables based on different levels of treatment. It was found that for each 1000 households in a county that received federal assistance, the percentage increase in the number of flood insurance policies was 3.41 %. On the other hand, for each million-dollar of federal assistance in a county, the total insured value of the flood insurance policies increased by 1.96 %. Therefore, this research has concluded that, contrary to the hypothesis, the availability of post-disaster federal assistance increased the flood insurance enrollment in the U.S.

Analisis Perhitungan Retensi Optimal Reasuransi Stop Loss dengan Metode Value at Risk (VaR)

Insurance companies do not cover the entire risk of policyholders. The risk is generally transferred in part to the reinsurance company. Stop loss reinsurance is a form of reinsurance contract where there is a limit on the risk value that can be borne by the insurance company. This value is the retention value or retention limit in the reinsurance contract, which is the maximum risk or insurance value that can be borne by the insurance company. Determining the right retention value is very important. Optimizing the Value at Risk risk measure is one approach in calculating optimal retention. Optimal retention criteria were identified in this research so that optimal retention values ​​could be calculated. This research uses a large claim data sample with the Weibull distribution. Determining optimal retention depends on the distribution of claim sizes and loading factors (additional factors in the insurance policy). With a 95% confidence level, for loading factors of 10%, 15%, and 20%, the estimated optimal retention values ​​are $1,080.56, $1,393.54, and $1,567.20. This means that the risk transferred to the reinsurer is the remaining claim amount, if the claim size exceeds the optimal retention value.

Lifecycle model-based evaluation of infant 4CMenB vaccination in the UK

ObjectivesInvasive meningococcal disease, an uncommon but severe disease, imposes catastrophic health and economic burdens. Cost–utility analysis (CUA) assumes separability in lifetime health and economic variables and cannot capture the full value of preventing such burdens. We overcome these limitations with a retrospective societal perspective cost–benefit analysis (CBA) of meningococcal serogroup B vaccination (4CMenB) of one infant cohort in the United Kingdom using a health-augmented lifecycle model (HALM) incorporating health’s interactions with consumption, earnings, non-market time and financial risk.MethodsWe used a static Markov model of vaccination’s health impact and an HALM to estimate the private willingness to pay (PWTP) for the intrinsic and instrumental value of health under perfect capital markets, financial risk protection in the absence of insurance against permanent disability, parental spillovers, and acute phase disability. We estimated social WTP (SWTP) incorporating social severity preferences. We estimated rates of return that inform health payer reimbursement decisions, finance ministry budgeting decisions, and legislature taxation decisions. An expert Advisory Board investigated the validity of applying the HALM to infant 4CMenB.ResultsThe PWTP for a 2 + 1 vaccination schedule is £395, comprising £166 of disability insurance value, £79 of positive parental spillover value, £28 in the value of averting acute phase disability, and £122 in residual intrinsic and instrumental value of health. SWTP is £969.ConclusionsHALM-based CBA provides an empirically richer, more utility–theoretically grounded approach to vaccine evaluation than CUA, demonstrating good value for money for legislatures (based on private values) and for all decision-makers (based on social values).