1.Of course, this will help with long-term budget planning An example of this situation has already been used in the uk life insurance sector. In Britain, life insurance companies write long-term transactions. While this has nothing to do with adapting to climate change or general insurance markets, we believe that the lessons learned from this sector closely related to the difficulty of managing multi-year price and price guarantees are very important. We consider three of their products that offer important long-term guarantees: retirement pensions, retirement savings with guaranteed pension rates and profit policy (Table 1). In the 1970s, 1980s and early 1990s, when many of these policies were written, interest rates were often in double digits, mortality rates were much higher and regulation was less burdensome, so spending was lower. At the time, insurers believed they were making good decisions and anticipating risks and price policy accordingly. However, this assumption proved to be incorrect; Interest rates have fallen significantly (from a long-term interest rate of about 15% per year. In the early 1990s, 0.5% per year. In early 2011, the mortality rate gradually improved as a result of new drugs, dietary changes and reduced smoking (the U.K.
Office of National Statistics estimated that the age-standardized mortality rate has decreased by 49 and 41% for men and women over the past 30 years, and regulations have strengthened , which has led to an increase in spending. When guaranteed pension rates began to bite, the Uk life insurance industry cost tens of billions of pounds to build up the necessary realistic reserves, which was one of the drivers of financial difficulties for Equitable Life, the oldest life insurance company in the UK. The feasibility of this decision would depend on the case. It is likely that the contract should be much longer than 5 years to offset the investment costs. Goss and O`Neill (2010) suggest that the premium should be much higher than for a contract without resistant rehiring (for example. B, 40% higher for a 5-year flood insurance policy for high-risk real estate and higher for a lower-risk property). 5. Both parties feel safe as long as they have consensual interests. It eliminates the feeling of insecurity with new buyers at all times.
A multi-year contract at a guaranteed price (or, alternatively, a price at the predefined ceiling and on the ground) offers the policyholder a financial guarantee and an insurance guarantee during the life of the insurance.