Pricing strategies in the German term life insurance market: An empirical analysis

Jonas R. Jahnert, Hato Schmeiser and Florian Schreiber

Risk Management and Insurance Review, 2022, vol. 25, issue 1, 19-34

Abstract: The life insurance sector is highly regulated. Areas of regulation include not only solvency requirements but also product pricing. In most industries, companies aim to increase producer rents by using information regarding the customer's willingness to pay (WTP), which allows them to endeavor price discrimination if no perfect competition prevails. In this article, we investigate the pricing behavior in the German Term Life insurance market by analyzing market prices, actuarial fair pricing, and the WTP for eighteen customer groups and three product categories. The results show that premiums charged for budget Term Life insurance products are in some cases even below the actuarially fair price. For term life insurance products with additional services, regulation, and market conditions hinder insurance companies from employing advanced strategies of price discrimination and the employment of the WTP.

Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://doi.org/10.1111/rmir.12202

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:rmgtin:v:25:y:2022:i:1:p:19-34

Access Statistics for this article

Risk Management and Insurance Review is currently edited by Mary A. Weiss

More articles in Risk Management and Insurance Review from American Risk and Insurance Association
Bibliographic data for series maintained by Wiley Content Delivery ().