Purchasing term life insurance to reach a bequest goal: time-dependent case

DOI10.1080/10920277.2015.1033107MaRDI QIDQ5379150zbMATH OpenOpenAlexFDO

Authors Erhan Bayraktar, S. David Promislow, Virginia R. Young

Publication date 28 May 2019

Published in North American Actuarial Journal (Search for Journal in Brave)

Full work available at URL https://arxiv.org/abs/1503.02237

zbMATH Keywords

bequest goalterm life insurance

Mathematics Subject Classification ID

Abstract: We consider the problem of how an individual can use term life insurance to maximize the probability of reaching a given bequest goal, an important problem in financial planning. We assume that the individual buys instantaneous term life insurance with a premium payable continuously. By contrast with Bayraktar et al. (2014), we allow the force of mortality to vary with time, which, as we show, greatly complicates the problem.

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Cites work

• scientific article; zbMATH DE number 4032883 (Why is no real title available?)
• scientific article; zbMATH DE number 2006037 (Why is no real title available?)
• Life insurance purchasing to maximize utility of household consumption
• Maximizing the utility of consumption with commutable life annuities
• Optimal commutable annuities to minimize the probability of lifetime ruin
• Purchasing life insurance to reach a bequest goal

Cited in

(7)

• Life insurance, precautionary saving and contingent bequest
• A pair of optimal reinsurance-investment strategies in the two-sided exit framework
• Purchasing life insurance to reach a bequest goal
• Purchasing term life insurance to reach a bequest goal while consuming
• Some applications of a model of term life insurance contracts
• Target-bequest investment and insurance fund
• The optimisation of insurance contracts on the viatical market

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