Journal of Insurance and Finance 2021 KCI Impact Factor : 0.67

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pISSN : 2384-3209
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2011, Vol.22, No.2

  • 1.

    Analyzing Guarantees in Variable Annuities

    김융희 , Kim, Changki | 2011, 22(2) | pp.3~25 | number of Cited : 8
    Abstract PDF
    In this study, we analyze the profit margin of variable annuities (VA) in Korean market and assess the risks embedded in the GMDB(guaranteed minimum death benefit) and GMAB (guaranteed minimum accumulation benefit) options. This paper shows that the real mortality costs and the real withdrawal rate have significant impact on the profit margin of VA products. We calculate the prices of the GMDB and GMAB options using simulation method and Black-Schloes option pricing model. The analysis shows that from the variable annuity market in Korea they have earned stable profits due to the conservative product structure and the favorable stock market. But there still exists the chance of losses from the embedded GMDB and GMAB options.
  • 2.

    Study on Elderly Medical Expenditure with a Lifetime Medical Expense Estimation

    조용운 | 2011, 22(2) | pp.27~51 | number of Cited : 4
    Abstract PDF
    As Korea is rapidly graying, the National Health Insurance Corporation (NHIC)'s expenditures on maintaining public health services are increasing. The annual growth rate of insurance benefits is only 11.7 percent for all ages between 2003 and 2008, but is up to 20.0 percent for those people aged 65 and over. In addition, that of out-of-pocket-money is 16.7 percent for the elderly during the same period, while it is 7.6 percent for all ages, implying that the out-of-pocket-money for the elderly keep increasing. The NHIC is estimated to have spent 31,105 thousand won on the lifetime medical expenses per capita for the elderly assuming that they may probably live up to the average life expectancy, which accounts for 53.2 percent of its overall lifetime medical ones. Additionally, the estimated medical expenses that the elderly directly spent are 23,137 thousand won, 51.3 percent of their lifetime out-of-pocket-money on medical expenses. Together with mortality rates, the per capita estimate that the NHIC expended for survivors aged 65 and over is 54,368 thousand won, 65.7 percent of its overall lifetime medical expenses, whereas their own estimated out-of-pocket-money is 40,800 thousand won, 64.1 percent of their lifetime one. Taking an increase in expenditures of the NHIC due to the population aging into account, the NHIC should prepare measures to secure stability and sustainability of its budget. On the other hand, the elderly need to find a way to pay their own out-of-pocket-money, and thus this paper suggests introducing senior medical savings account (SMSA) to support their self-help efforts.
  • 3.

    An Empirical Study on Factors Affecting Firms in Selecting a Type of the Retirement Pension Plan by Utilizing a Sequential Logit Model

    김대환 , 류건식 | 2011, 22(2) | pp.53~75 | number of Cited : 7
    Abstract PDF
    Prior research regarding the retirement pension plan has focused on policy improvement. That is because the retirement pension plan in Korea is inadequate in many aspects compared to the retirement pension plan in other countries which adopted it quite a while ago and the data related to the retirement pension plan is little built. Utilizing the Workplace Panel Survey Data, this study investigates how a firm selects a specific type of retirement pension plan. After the retirement pension plan was introduced in December 2005, each firm chooses a specific type of retirement pension plan conditional on deciding whether to adopt the retirement pension plan. For empirically investigating the firm's sequential decision making process, the sequential logit model is utilized in this study. The empirical results indicate that firms with higher level of sales revenue or relatively older employees prefer the defined benefit pension plan. However, firms with higher ratio of expert employees whose turnover rates tend to be higher, annual salary system, job security and relatively more age prefer the defined contribution pension plan. This study would provide clearer pictures about the relationship between firms and types of retirement pension plans to enterprises in the retirement pension market and policy makers.