Life Insurance Industry Research Articles

Risk Management in Deadly Times: The U.S. Life Insurance Industry in the 1918–9 Influenza Pandemic

AbstractUsing a novel, hand‐collected dataset of U.S. life insurance companies during the influenza pandemic of 1918–9, we show that high‐exposure life insurers charged higher prices on new policies vis‐à‐vis less exposed firms. Although the disease surprisingly increased the mortality rates among younger adults, it also increased awareness of the importance of life insurance. We argue that price increases were a crucial risk management tool. Coupled with a surge in demand and coverage, it prevented further financial distress. Although devastating for public health, the influenza pandemic was not too severe for the life insurance industry.

Assessing the Impact of Big Five Personality Traits on Job Performance: A Study in Association with Insurance Agents in Northern Province, Sri Lanka

The flourishing life insurance industry in Sri Lanka underscores the pivotal role of insurance agents in advancing revenue streams and overall success. This study examines the nexus between the Big Five personality traits and the Job performance of insurance agents in the life insurance companies in the Northern Province of Sri Lanka. The independent variables encompass the dimensions of openness to experience, conscientiousness, extraversion, agreeableness, and emotional stability, while the dependent variable comprises job performance. A stratified random sampling approach was employed to distribute 300 structured questionnaires among insurance agents in life insurance companies. The collected data were analyzed by using different statistical techniques. The outcomes of the multiple regression analysis underscore a substantial impact of all Big Five personality dimensions excluding agreeableness on job performance. These findings offer valuable insights for insurance agents, aiding them in making informed career choices. Simultaneously, life insurance company managers can leverage this research to refine their selection criteria, ensuring the recruitment of individuals whose personalities align with the dimensions that significantly impact job performance in the industry and identify the training needs for the personality development of the insurance agent in the life insurance companies in Sri Lanka.

Beware the Black Widow at Claim Time: A Report of Three Cases.

Moral hazard is well known to life insurance underwriters and medical directors to increase the risk of adverse consequences to insured individuals. The underwriting investigation of proposed insureds at time of policy issue is done to ensure no likely moral hazard exists. However, not all situations involving moral hazard may be identified at time of underwriting and policy issue, and may only be identified at time of claim. Three cases that were underwritten for life expectancies in legal matters are described here as examples of moral hazard identified at time of severe injury and/or death. All three of these cases involved a woman who manipulated her male partner into situations that increased the man's risk of severe injury and/or death to the woman's financial benefit. Such "black widows" made a great deal of effort over an extensive period of time to ensure that the moral hazard set up for their male partners resulted in a substantial financial windfall through litigation. The moral hazard set up by a black widow thus can be considered by the life insurance industry as sufficiently anti-selective and speculative to deny a claim at any time after policy issue.

An Empirical Analysis of Growth Trends and Correlations among Life Funds, Pension & General Annuity Funds, and ULIP Funds in the Indian Life Insurance Industry

Purpose: This study aims to analyze the growth trends and correlations among three key fund types in the Indian life insurance industry: Life Funds, Pension & General Annuity Funds, and Unit-Linked Insurance Plans (ULIP) Funds. Explicitly, this study intends to answer the resulting research questions: • Which fund type has exhibited the highest AUM growth rate? • What are the key factors contributing to the growth of each fund type? • What are the implications of the findings for the Indian life insurance industry? Design/methodology/approach: The study employs a quantitative research methodology, focusing on historical data spanning from 2014 to 2023. By using statistical techniques such as Analysis of Variance (ANOVA) and correlation analysis, the research identifies and evaluates the significant differences and relationships among the various fund types. ANOVA is used to determine if there are statistically significant differences in growth rates among the funds, while correlation analysis helps in understanding the strength and direction of relationships between the funds. Findings: The analysis uncovers significant disparities in the growth rates of the different fund types. Specifically, Pension & General Annuity Funds demonstrate the highest growth rate among the three. Additionally, the study finds a weak positive correlation between Life Funds and ULIP Funds, indicating a slight tendency for these two fund types to grow together, although the relationship is not strong. Originality/value: This research contributes novel insights into the Indian life insurance industry by showcasing the distinct growth patterns and interrelationships among Life Funds, Pension & General Annuity Funds, and ULIP Funds. The findings are valuable for stakeholders in the industry, as they can inform strategic decisions related to investment, product development, and marketing. By understanding these trends and correlations, life insurance companies can better tailor their offerings to meet market demands and optimize their growth strategies. Key words: Life insurance industry, growth trends, correlations, fund types, investment decisions, product development, marketing strategies.

Research on Interest Spread Risk of Commercial Pension Insurance in the Context of Negative Interest Rates

In the current low-interest-rate environment, the high-quality development of the life insurance industry faces many challenges. Among them, interest rate spread risk has a significant impact on the stable operation and long-term healthy development of the life insurance industry. Interest rate spread risk has characteristics such as long-term nature, hidden potential, and systematic impact. When severe, it can lead to the bankruptcy of insurance companies and bring about systemic crises in the industry. This article redefines negative interest rates and the risk of interest rate spread loss in commercial pension insurance, and reviews related literature.

Determinants of Profitability of the Islamic Life Insurance Industry in Indonesia

Determinants of Profitability of the Islamic Life Insurance Industry in Indonesia

Role of Behavioral Economics in Predicting Life Insurance Policy Lapses in United Kingdom

Purpose: The aim of the study was to analyze the role of behavioral economics in predicting life insurance policy lapses in United Kingdom. Methodology: This study adopted a desk methodology. A desk study research design is commonly known as secondary data collection. This is basically collecting data from existing resources preferably because of its low cost advantage as compared to a field research. Our current study looked into already published studies and reports as the data was easily accessed through online journals and libraries. Findings: In the United Kingdom, behavioral economics plays a significant role in predicting life insurance policy lapses. Key factors such as loss aversion, present bias, and financial literacy heavily influence policyholder decisions. Policyholders who are more loss-averse tend to maintain their policies, while those with a strong present bias are more likely to lapse, especially during financial stress. Additionally, lower financial literacy contributes to higher lapse rates, as individuals struggle to understand the long-term benefits of life insurance. Unique Contribution to Theory, Practice and Policy: Prospect theory, hyperbolic discounting & theory of planned behavior (TPB) may be used to anchor future studies on the role of behavioral economics in predicting life insurance policy lapses in United Kingdom. Insurers should tailor their communication strategies to address specific behavioral biases identified in policyholders. Policymakers should mandate the inclusion of financial literacy programs within the life insurance industry to educate consumers about the importance of maintaining their policies.

Exploring the Antecedents of Business Strategies in Bancassurance Sector of Pakistan

The urgent need to comprehend the variables influencing strategic decision-making in this industry is addressed by this study. Through an exploration of the complex interactions between several internal and external factors, this study seeks to evaluate the fundamental factors that impact strategic decisions in the life insurance industry. This research's rationale stems from the realization that effective business plans are a result of organizational capacity and strategic foresight in addition to market circumstances. Comprehending these precursors is of paramount importance for scholars and professionals in the sector alike, as it can furnish invaluable discernments into the ways in which Bancassurance enterprises can more adeptly maneuver the intricate commercial landscape. The research is qualitative in nature. Thematic analysis have been applied as a tool to analyze the transcribe data obtained through interviews. The themes obtained through interviews are Business productivity through distribution network, Efficiency in business communication protocols, Enhancement in bank’s consumer market share, Increase of capital adequacy value of bank’s market share, Reshaping Bancassurance partners business strategy in consumer market Banks can effectively diversify their product and service offerings, thereby increasing revenue streams, optimizing resource use, and perhaps strengthening their market positions, by working together with Bancassurance.

Recent Trends in Life Insurance: Innovations, Challenges, and Implications

This research paper explores recent trends in the life insurance industry, focusing on innovations, challenges, and implications for insurers, consumers, and regulators. Drawing on a comprehensive review of literature, market analysis, and industry reports, the paper examines key trends shaping the landscape of life insurance in the digital age. It highlights the impact of technological advancements, changing consumer preferences, regulatory developments, and demographic shifts on product design, distribution channels, underwriting practices, and risk management strategies. The paper also discusses emerging opportunities and challenges for life insurers in addressing the evolving needs and expectations of customers, enhancing operational efficiency, and navigating regulatory complexities. Through a critical analysis of recent trends, the paper aims to provide insights into the future direction of the life insurance industry and inform stakeholders about potential strategies for sustainable growth and innovation.

Impact of Digitalization on the Life Insurance Industry

Insurance companies are focusing more on digital transformation as it becomes more crucial in today's market. It presents chances and difficulties, especially for IT departments, which are vital in supporting or impeding advancement. The objective of this paper is to offer a detailed explanation of how digital technologies, including artificial intelligence and cloud computing, are used in the insurance sector. We examined scholarly articles, industry reports, and regulatory publications to collect information. We found the IT needs of insurers and uncovered numerous relationships among various digital technologies. Our results emphasize the importance of insurers implementing a thorough digital strategy to successfully utilize these technologies.

The Growth and Profitability of Life Insurance Industry in India – A Comparative Analysis between Public and Private Sector Companies

The Growth and Profitability of Life Insurance Industry in India – A Comparative Analysis between Public and Private Sector Companies

How the Medical Director Should Use Data Sources.

The life insurance industry is transitioning towards precision underwriting driven by increased data availability and access to advanced analytical tools. Effectively utilizing diverse data sources in life insurance underwriting presents an opportunity for medical directors to fully leverage their skillset in this evolving environment. By navigating these changes, balancing the value of data against its limitations, and fostering collaborative approaches to enhance risk assessment and underwriting processes, medical directors can maintain a pivotal role in the life insurance companies of tomorrow.

CEO optimism and the use of credit default swaps: evidence from the US life insurance industry

CEO optimism and the use of credit default swaps: evidence from the US life insurance industry

Human capital management: new factors of production in the Indonesian life insurance industry

In the current era of the Information Society, competition in any business industry is increasingly fierce. However, the lack of skilled workers is a major obstacle in increasing company production. Human Resources problems are still not enough to overcome complex problems. In the current era of modern globalization, competitive advantage is largely determined by the formation of Human Capital. The inadequate level of knowledge from theoretical and practical aspects of Human Capital Management in increasing sustainable production determines the objectives of this research and problem formulation so that solutions can be found, because the attention of developed and developing countries is currently more focused on developing Human Capital which is one of the company's solutions in Human Resources development which tends to have a significant impact on performance. This research examines Human Capital's direct impact on employee performance and becomes a new production factor in the Indonesian Life Insurance industry. The results of this research are to justify and develop that human capital management including TASK (Talent, Attitude, Skill, Knowledge) through continuous training with studies in the Indonesian Life Insurance Industry sector is a production factor that can also improve employee and company performance.

EXPLORING FACTORS INFLUENCING INFORMATION SOURCE PREFERENCES IN THE LIFE INSURANCE INDUSTRY: A FACTOR ANALYSIS APPROACH

This research investigates the availability of information sources preferences for individuals seeking life insurance policies. With the life insurance landscape evolving rapidly, understanding the accessibility and efficacy of information is crucial. This study examines various sources including insurance agents, company websites, online platforms, social media, and traditional media. Through quantitative surveys, it assesses the comprehensiveness, reliability, and impact of these sources on consumers decision-making processes. The findings provide insights for insurance companies to enhance consumer education, improve awareness, and optimize communication strategies, ultimately fostering a more informed and empowered consumer base in the life insurance market.This research delves into the nuanced determinants influencing insured individuals choices of information sources within the life insurance industry, employing a factor analysis methodology.Factor analysis is employed to identify and analyze the underlying dimensions. The study aims to uncover the key factors that influence insured persons decision-making processes and satisfaction levels in Life insurance.

The Impacts of Ethical Sales Behaviour on Customer Loyalty in the Life Insurance Industry in Pakistan

The life insurance industry in Pakistan is highly competitive, with customer loyalty playing a crucial role in long-term success. Ethical sales behaviour emerges as a key differentiator, potentially fostering trust and driving positive customer experiences. This research investigates the relationship among ethical sales behaviour, customer trust in company and trust in sales agent, which directly affect customer loyalty in the life insurance industry. The quantitative survey targets customers of five major life insurance companies, ensuring a representative sample across diverse demographics. The questionnaires were sent to all companies customer on a random basis. The questionnaires are distributed with the help of office employee of the companies.The finding of the study shows that there is a direct and positive relation between sales agent ethical sales behaviour and customer loyalty. Furthermore, the trust of the customer in the sales agent and trust of the customer in a company has direct positive mutual relation and customer trust both affect customer loyalty. By demonstrating the tangible benefits of ethical sales behaviour, the study can encourage companies to implement and prioritize ethical practices. The identified key drivers of customer loyalty can guide training programs and performance evaluations for insurance agents, ultimately fostering a culture of ethical conduct within the industry.

Corporate Reputation, Salesperson Trustworthiness and Customer Loyalty in the Life Insurance Industry

Corporate Reputation, Salesperson Trustworthiness and Customer Loyalty in the Life Insurance Industry

Frailty-based mortality models and reserving for longevity risk

For the life insurance industry and pension schemes, mortality projections are critical for accurately managing exposure to longevity risk in terms of both premium setting and reserving. Frailty has been identified as an important latent factor underpinning the evolution of mortality rates. It represents the comorbidities that drive the deterioration of the human body’s physiological capacity. In this paper, we propose a stochastic mortality model that incorporates the trend in frailty, and we analyse the gap between the actuarial evaluations of premiums and technical provisions calculated under frailty-based and traditional stochastic mortality models. We observe that the frailty-based model leads to higher levels of uncertainty in estimates and projections (compared to a traditional stochastic mortality model), which is attributed to the explicit modelling of the comorbidities. This leads to proposing a potentially important policy-oriented recommendation: the incorporation of frailty in mortality modelling would allow for the profiling of mortality according to the portfolio in force for the insurer (or pension scheme), thereby mitigating the problem of adverse selection.

Examining Market Competition and Financial Stability: An Econometric Analysis of India’s Life and Non-Life Insurance Industry

Using the panel data analysis, this study investigates the evolution of competition over the study period and subsequently examines the relationship between competitiveness and financial stability within the Indian insurance segment. Adopting the methodology proposed by Boone (2008), competition is measured using the Boone indicator, while financial stability is quantified using the Z-score. Spanning over 15 years, i.e., 2009 to 2023, the study assesses both the life and non-life insurance segments within the Indian market. Throughout the study period, a decline in competition is observed across both segments, owing to the increased concentration among major insurers. Nevertheless, the study’s results support the Boyd and De Nicolo (2005) competition-stability hypothesis, suggesting that which suggests that increased market competition is associated with increased financial resilience. Additionally, the results using the Boone indicator highlight efficiency as the main mechanism by which competition fosters better financial stability. With their insights into the dynamics of competition and stability within the Indian insurance landscape, these findings have important ramifications for insurance companies, academics, and policymakers alike.

Factors Influence on Customers’ Satisfaction in Government Owned Life Insurance Firm: A Case of Rastriya Beema Sansthan, Nepal

Customer service is an integral part of any life insurance company. It is necessary to identify the key success factors in the life insurance industry, in terms of customer satisfaction, so as to survive the intense competition and increase insurance penetration (Nyaguthii, 2013). The important factor in creating customer satisfaction is the appropriate insurer with customers. Insurers believe the factors such as behavior and dealing effectively with the insured, ability of insurance agents to transmit accurate information, establish long term relationships with customers are the important factors in the success of the insurance industry (Vazifehdust & Farokhian, 2013). Thus, the study aims in analyzing the determinants of customer satisfaction in Rastriya Beema Sansthan, an insurance company of developing country Nepal. The study has adopted descriptive and analytical research design. The purposive sampling method is used to collect the primary response from the respondents. The descriptive analysis, correlation analysis and regression analysis have been conducted to analyze the relationship between customer satisfaction with premium, communication, claim settlement, service recovery and service quality in Rastriya Beema Sansthan. The study concludes that the service quality has no impact on customer satisfaction whereas other variables tested have been found significant. The results of the research are expected to hit the policy of Rastriya Beema Sansthan with broadening the scope of the study.