Analyzing the Selection Effect in the Private Korean Annuity Market
- 주제(키워드) adverse selection , money’s worth , private annuity
- 등재 SCIE, SSCI, SCOPUS
- OA유형 gold
- 발행기관 MDPI
- 발행년도 2022
- 총서유형 Journal
- URI http://www.dcollection.net/handler/ewha/000000190145
- 본문언어 영어
- Published As https://doi.org/10.3390/su14095276
초록/요약
The purpose of this study is to investigate the degree of adverse selection in the Korean individual annuity market using the money’s worth calculations. The insurers’ pricing of different annuity products reflects individual’s self-selection into products based on private information about their mortality prospects. Using payments offered for different products, money’s worth calculations were higher for younger and male annuitants, annuity with a bigger premium size and longer guarantee period, frontloaded (as opposed to level) annuity, joint (as opposed to single) annuity, tax-qualified (as opposed to non-tax-qualified) annuity, and deferred (as opposed to immediate) annuity. In a cross-country analysis, we observe that the cost of adverse selection is higher in countries with more generous social security income. © 2022 by the authors. Licensee MDPI, Basel, Switzerland.
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