Problems of Increasing Life Expectancy in Private Insurance - Theory and Practice for Germany

DIW Discussion Paper No. 258

35 Pages Posted: 11 Nov 2003

See all articles by Gert G. Wagner

Gert G. Wagner

German Institute for Economic Research (DIW Berlin); Berlin University of Technology; German Socio-Economic Panel Study (SOEP)

Johannes Leinert

affiliation not provided to SSRN

Date Written: July 2001

Abstract

An unexpected increase in life expectancy has implications for private pensions (annuities). These can be offset by reducing pension payments, cross-subsidization of the pension payments, risk-taking of insurance companies or combining these policies. An empirical study of the German market of annuities shows that most of the companies under investigation dealt with the problem of an unexpected increase of life expectation in the 90ies by significant cross-subsidization of the pension payments from young policy holders. This paper discusses the implications such polices can have when the importance of private pensions increases in the future.

Keywords: life expectancy, private pensions, insurance

JEL Classification: G2, H55, J14

Suggested Citation

Wagner, Gert G. and Leinert, Johannes, Problems of Increasing Life Expectancy in Private Insurance - Theory and Practice for Germany (July 2001). DIW Discussion Paper No. 258, Available at SSRN: https://ssrn.com/abstract=302342 or http://dx.doi.org/10.2139/ssrn.302342

Gert G. Wagner (Contact Author)

German Institute for Economic Research (DIW Berlin) ( email )

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HOME PAGE: http://www.diw.de/programme/jsp/MA.jsp?language=en&uid=gwagner

Berlin University of Technology ( email )

Stra├če des 17
Berlin, 10623
Germany
+30 8 978 9283 (Phone)

German Socio-Economic Panel Study (SOEP) ( email )

DIW Berlin
10108 Berlin, Berlin
Germany
+49 30 8978 9290 (Phone)
+49 30 8978 9109 (Fax)

HOME PAGE: http://www.diw/en/soep

Johannes Leinert

affiliation not provided to SSRN

No Address Available

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