Actuarial Pricing Models of Reverse Mortgage with the Stochastic Interest Rate
Authors
N.N. Jia, H. Yang, J.B. Yang
Corresponding Author
N.N. Jia
Available Online October 2015.
- DOI
- 10.2991/essaeme-15.2015.137How to use a DOI?
- Keywords
- Reverse mortgage, Actuarial pricing, Stochastic interest rate
- Abstract
The aging problem became more important and serious in China in recent years. The reverse mortgage is an innovation model to support the aged people. In this study, the accumulation function model of interest force with a Wiener process and a negative-binomial distribution is proposed as the basis for the reverse mortgage. With the proposed model, a lump sum pricing model, annuity pricing model, linear increasing annuity pricing model for single-life and double-lives are provided. All of the models can be improved to solve the problem that the actuarial pricing models of reverse mortgage only could be calculated by the fixed interest rate.
- Copyright
- © 2015, the Authors. Published by Atlantis Press.
- Open Access
- This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).
Cite this article
TY - CONF AU - N.N. Jia AU - H. Yang AU - J.B. Yang PY - 2015/10 DA - 2015/10 TI - Actuarial Pricing Models of Reverse Mortgage with the Stochastic Interest Rate BT - Proceedings of the 2015 International Conference on Economics, Social Science, Arts, Education and Management Engineering PB - Atlantis Press SP - 639 EP - 642 SN - 2352-5398 UR - https://doi.org/10.2991/essaeme-15.2015.137 DO - 10.2991/essaeme-15.2015.137 ID - Jia2015/10 ER -