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Keywords = reverse annuity contract

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15 pages, 1133 KB  
Article
Marriage and Individual Equity Release Contracts with Dread Disease Insurance as a Tool for Managing the Pensioners’ Budget
by Agnieszka Marciniuk and Beata Zmyślona
Risks 2022, 10(7), 140; https://doi.org/10.3390/risks10070140 - 12 Jul 2022
Cited by 1 | Viewed by 2240
Abstract
In many countries around the world, demographic and civilization changes have brought about the phenomenon of aging societies. This phenomenon affects the economy, especially the pension and health care systems, causing difficulties in their financing. The implementation of a policy that would effectively [...] Read more.
In many countries around the world, demographic and civilization changes have brought about the phenomenon of aging societies. This phenomenon affects the economy, especially the pension and health care systems, causing difficulties in their financing. The implementation of a policy that would effectively manage the problem of the longevity risk is thus required. Using housing resources and private health insurance to improve retirees’ living standards may serve this purpose. The instruments we propose comprise two variants of contracts: the first for a marriage, the second for an individual client. We analysed the cash flow in both the cases. The results suggest that the amount of cash flows related to reverse equity and dread disease insurance benefits depends on the spouse’s economic status, age, and health conditions. The benefits of the two variants of the contract vary. This paper examines numerous strategies for selecting the type of the contract, taking into consideration the abovementioned factors. Full article
(This article belongs to the Special Issue Actuarial Mathematics and Risk Management)
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