Policyholder exercise behavior in life insurance : the state of affairs

Authors

Daniel BAUER, Department of Economics, Finance, and Legal Studies, University of Alabama, Alabama
Jin GAO, Department of Finance and Insurance, Lingnan University, Hong Kong
Thorsten MOENIG, Department of Risk, Insurance, and Healthcare Management, Temple University, Pennsylvania
Eric R. ULM, School of Economics and Finance, Victoria University of Wellington, New Zealand
Nan ZHU, Risk Management Department, Pennsylvania State University, Pennsylvania

Document Type

Journal article

Source Publication

North American Actuarial Journal

Publication Date

1-1-2017

Issue

4

First Page

485

Last Page

501

Publisher

Routledge

Abstract

The article presents a review of structural models of policyholder behavior in life insurance. We first discuss underlying drivers of policyholder behavior in theory and survey the implications of different models. We then turn to empirical behavior and appraise how well different drivers explain observations. The key contributions lie in the synthesis and the systematic categorization of different approaches. The article should provide a foundation for future studies, and we describe some important directions for future research in the conclusion.

DOI

10.1080/10920277.2017.1314816

Print ISSN

10920277

E-ISSN

23250453

Funding Information

This article concludes the research under the Society of Actuaries’ (SOA) Center of Actuarial Excellence (CAE) Research Grant “Structural Models of Policyholder Behavior.” Financially support by the SOA.

Publisher Statement

Copyright © Society of Actuaries. Access to external full text or publisher's version may require subscription.

Full-text Version

Publisher’s Version

Language

English

Recommended Citation

Bauer, D., Gao, J., Moenig, T., Ulm, E. R., & Zhu, N. (2017). Policyholder exercise behavior in life insurance: The state of affairs. North American Actuarial Journal, (4), 485-501. doi: 10.1080/10920277.2017.1314816