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Portfolio Issues of Mobilization Insurance: What Went Wrong, and Candidate New Offerings

Journal of Business and Economics Research, Vol. 4, No. 5, pp. 1-16, May 2006

15 Pages Posted: 26 Aug 2009 Last revised: 10 May 2011

Terrance Jalbert

University of Hawaii - Department of Business Administration

Mercedes Jalbert

The Institute for Business and Finance Research

David Hammes

University of Hawaii - Department of Economics

Date Written: August 25, 2009

Abstract

Financial hardships experienced by those in the military are well documented. Mobilization insurance has the potential to reduce the financial burdens of being called to active military duty. Reducing the financial burden of being called to active duty can provide numerous benefits to the military and Reservists including improved recruiting, lower attrition and reduced stress on activated Reservists. In this paper, the Ready Reserve Mobilization Income Insurance Program and the reasons for its failure are discussed. The portfolio characteristics of the stakeholders involved in the Reserve system are analyzed in an options pricing framework and a discussion of how a new mobilization insurance product might be structured is examined. While the concept of offering such insurance is simple enough, no known academic research has analyzed the financial positions of Reserve system stakeholders.

Keywords: Insurance, Portfolio Theory, Military

JEL Classification: G11, G20

Suggested Citation

Jalbert, Terrance and Jalbert, Mercedes and Hammes, David, Portfolio Issues of Mobilization Insurance: What Went Wrong, and Candidate New Offerings (August 25, 2009). Journal of Business and Economics Research, Vol. 4, No. 5, pp. 1-16, May 2006 . Available at SSRN: https://ssrn.com/abstract=1461846

Terrance Jalbert (Contact Author)

University of Hawaii - Department of Business Administration ( email )

808-974-7456 (Phone)

Mercedes Jalbert

The Institute for Business and Finance Research ( email )

P.O. Box 5569
Hilo, HI 96720
United States

HOME PAGE: http://www.theIBFR.com

David Hammes

University of Hawaii - Department of Economics ( email )

Hilo, HI 96720-4091
United States

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