Tag: annuity cost
![Senior couple and tecnologies](https://crr.bc.edu/wp-content/uploads/2022/11/financing_retirement_2-1536x1024.jpg)
The brief’s key findings are: “Longevity bonds” would allow insurers and pension plans to hedge aggregate longevity risk. The bonds’ coupon would rise if a cohort lived longer than expected, offsetting higher annuity costs. Longevity bonds would lower capital requirements for insurers and reduce risk for pension plan sponsors. Governments could take the lead in…
![Working together on their budget](https://crr.bc.edu/wp-content/uploads/2022/11/financing_retirement_5-1536x988.jpg)
Introduction An annuity provides an individual or a household with insurance against living too long. In exchange for a one-time premium payment, the insurer agrees to make periodic payments to the insured for life. In theory, annuities seem like a valuable product for many retirees given an uncertain date of death. However, in practice, few…