Skip to main content

A multi-state model for a life insurance product with integrated health rewards program

Date created
2016-12-02
Authors/Contributors
Author: Zhang, Lidan
Abstract
With the prevalence of chronic diseases that account for a significant portion of deaths, a new approach to life insurance has emerged to address this issue. The new approach integrates health rewards programs with life insurance products; the insureds are classified by fitness statuses according to their level of participation and would get premium reductions at the superior statuses. We introduce a Markov chain process to model the dynamic transition of the fitness statuses, which are linked to corresponding levels of mortality risks reduction. We then embed this transition process into a stochastic multi-state model to describe the new life insurance product. Formulas are given for calculating its benefit, premium, reserve and surplus. These results are compared with those of the traditional life insurance. Numerical examples are given for illustration.
Document
Identifier
etd9894
Copyright statement
Copyright is held by the author.
Permissions
This thesis may be printed or downloaded for non-commercial research and scholarly purposes.
Scholarly level
Download file Size
etd9894_LZhang.pdf 1.42 MB

Views & downloads - as of June 2023

Views: 32
Downloads: 6