LONGEVITY INSURANCE: A MISSING MARKET

Adam Creighton, Henry Hongbo Jin, John Piggott and Emiliano A. Valdez
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Adam Creighton: School of Economics, University of New South Wales, Sydney 2052, Australia
Henry Hongbo Jin: School of Economics, University of New South Wales, Sydney 2052, Australia
Emiliano A. Valdez: School of Actuarial Studies, University of New South Wales, Sydney 2052, Australia

The Singapore Economic Review (SER), 2005, vol. 50, issue spec0, 417-435

Abstract: More than half of the world's old live in Asia, and around 35% in India and China alone. As demographic transition proceeds regionally and globally, the development of a robust and reliable longevity insurance market will become essential. Although the need for such insurance is most pressing in Asia, longevity risk is poorly managed practically everywhere. This paper reviews theory and practice relating to longevity risk and insurance, amid a rapidly changing demographic and policy landscape. It analyzes the reasons for the failure of longevity insurance markets, and examines possible innovations in both markets and public policy that may lead to a more vibrant market and a greater variety of longevity insurance products. These include risk sharing between the buyer and seller, "deductibles", reverse mortgages, and securitization.

Keywords: Annuity; retirement; pension; longevity risk (search for similar items in EconPapers)
Date: 2005
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Citations: View citations in EconPapers (2)

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DOI: 10.1142/S0217590805002128

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