AEA Papers and Proceedings
ISSN 2574-0768 (Print) | ISSN 2574-0776 (Online)
Global Life Insurers during a Low Interest Rate Environment
AEA Papers and Proceedings
vol. 112,
May 2022
(pp. 503–08)
Abstract
Life insurers' business model has changed with the growth of insurance products with minimum return guarantees that are exposed to market and interest risks. The interest risk exposure of US and European insurers increased in the low-rate environments after the global financial crisis and the European sovereign debt crisis, respectively. The relative fragility of life insurers is highly persistent across the global financial crisis, the European sovereign debt crisis, and the COVID-19 crisis. European insurers with a higher share of liabilities with minimum return guarantees in 2016 had lower stock returns during the COVID-19 crisis.Citation
Koijen, Ralph S. J., and Motohiro Yogo. 2022. "Global Life Insurers during a Low Interest Rate Environment." AEA Papers and Proceedings, 112: 503–08. DOI: 10.1257/pandp.20221076Additional Materials
JEL Classification
- G01 Financial Crises
- G14 Information and Market Efficiency; Event Studies; Insider Trading
- G22 Insurance; Insurance Companies; Actuarial Studies
- G32 Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
- H63 National Debt; Debt Management; Sovereign Debt
- I12 Health Behavior