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Estimation of Life Insurance Asset Value From Household Survey

Author

Listed:
  • Ting Zeng
  • Qian Cao

    (Research Institute of Economics and Management, Southwestern University of Finance and Economics, China)

Abstract

The omission of the asset value of life insurance policies in computing household assets would underestimate household wealth and therefore bias measures of wealth inequality. We propose a method to estimate the cash value of household life insurance assets by combining the Lee-Carter model, which forecasts mortality risk, and the concept of the net level premium reserve in actuarial science. This method is readily applicable using household survey data.

Suggested Citation

  • Ting Zeng & Qian Cao, 2022. "Estimation of Life Insurance Asset Value From Household Survey," Asian Economics Letters, Asia-Pacific Applied Economics Association, vol. 3(1), pages 1-6.
    • Handle: RePEc:ayb:jrnael:59
    DOI: 2022/06/16
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    References listed on IDEAS

    as
    1. Li Gan & Zhichao Yin & Nan Jia & Shu Xu & Shuang Ma & Lu Zheng, 2014. "Data you need to know about China," Springer Books, Springer, edition 127, number 978-3-642-38151-5, November.
    2. Jesse Bricker & Lisa J. Dettling & Alice Henriques Volz & Joanne W. Hsu & Lindsay Jacobs & Kevin B. Moore & Sarah Pack & John Edward Sabelhaus & Jeffrey P. Thompson & Richard Windle, 2017. "Changes in U.S. Family Finances from 2013 to 2016: Evidence from the Survey of Consumer Finances," Federal Reserve Bulletin, Board of Governors of the Federal Reserve System (U.S.), vol. 103(3), September.
    3. Møller,Thomas & Steffensen,Mogens, 2007. "Market-Valuation Methods in Life and Pension Insurance," Cambridge Books, Cambridge University Press, number 9780521868778.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    life insurance asset value; Net level premium reserve; Mortality estimation; Household wealth inequality;
    All these keywords.

    JEL classification:

    • G22 - Financial Economics - - Financial Institutions and Services - - - Insurance; Insurance Companies; Actuarial Studies
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • N3 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy

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