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The Risks of Pricing New Insurance Products: The Case of Long-Term Care


Abstract: This article examines what happens when incorrect assumptions are made in pricing new insurance products. The focus is on the mispricing of long-term care (LTC) insurance?which led to the insolvency of Penn Treaty.1

Keywords: Insurance; long-term care;

https://doi.org/10.21033/cfl-2018-397

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Provider: Federal Reserve Bank of Chicago

Part of Series: Chicago Fed Letter

Publication Date: 2018

Order Number: 397