Did COVID-19 Change Life Insurance Offerings?

Timothy F. Harris, Aaron Yelowitz and Charles Courtemanche

No 28172, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: The profitability of life insurance offerings is contingent on accurate projections and pricing of mortality risk. The COVID-19 pandemic created significant uncertainty, with dire mortality predictions from early forecasts resulting in widespread government intervention and greater individual precaution that reduced the projected death toll. We analyze how life insurance companies changed pricing and offerings in response to COVID-19 using monthly data on term life insurance policies from Compulife. We estimate event-study models that exploit well-established variation in the COVID-19 mortality rate based on age and underlying health status. Despite the increase in mortality risk and significant uncertainty, we find limited evidence that life insurance companies increased premiums or decreased policy offerings due to COVID-19.

JEL-codes: D81 I13 (search for similar items in EconPapers)
Date: 2020-12
New Economics Papers: this item is included in nep-hea, nep-ias and nep-rmg
Note: EH PE
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Citations: View citations in EconPapers (2)

Published as Timothy F. Harris & Aaron Yelowitz & Charles Courtemanche, 2021. "Did COVID‐19 change life insurance offerings?," Journal of Risk and Insurance, vol 88(4), pages 831-861.

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Journal Article: Did COVID‐19 change life insurance offerings? (2021)
Working Paper: Did COVID-19 Change Life Insurance Offerings? (2020)
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