New Life Insurance Financial Products

This chapter provides an overview of new life insurance financial products. After a general market overview, Sect. 36.2 presents different forms of traditional and innovative life insurance financial products and their main characteristics. Since unit-linked and equity- indexed type contracts represent the basis for most innovative products in recent years, Sect. 36.3 presents basic aspects of the modeling, valuation, and risk management of unit- linked life insurance contracts with two forms of investment guarantees (interest rate and lookback guarantees) and different underlying investment strategies. In Sect. 36.4, variable annuities are discussed and focus is laid on challenges for insurers in regard to pricing and risk management of the various embedded options. Section 36.5 finally puts the customer's perspective in the center of the analysis, along with a discussion of current developments regarding product information documents and performance and risk-return profiles, which is of special relevance for new and traditional products.