Download or read book The Fair Premium of an Equity-Linked Life and Pension Insurance written by J. Aase Nielsen and published by . This book was released on 2006 with total page 30 pages. Available in PDF, EPUB and Kindle. Book excerpt: An equity linked life and pension insurance consists of a non-linear combination of a life and pension insurance with an investment strategy. In addition to the guaranteed payments the insured receives a bonus depending on the value of an investment strategy. The additional payment is similar to an Asian type option. Since the insurance contract combines mortality and financial risks in a non-linear way, the value or premium of the contract must reflect these uncertainties. Within this context a premium sequence is called fair if the accumulated expected discounted premium is equal to the accumulated expected discounted payments of the contract. This paper shows the existence of a fair periodic premium. For two different pension policies an approximation of the fair periodic premium is derived.