| dc.description.abstract | In Taiwan, people are insured by national health insurance, and medical care and sanitary conditions have been improved in the past 20 years. Thus, mortality rate has declined and the average life expectancy has risen.
Due to rising life expectancy and declining birth rates, 11.77% of the population was 65 years or older, by end of July, 2014. According to the population ageing, defined by United Nations, the rate of population ageing in the 21st century will exceed that of the previous century. Therefore, we have to face this aging problem seriously and make financial plan as earlier as we can for the nearly future.
In addition, since the Financial Crisis in 2008, United States had cut Fed Funds rate and implemented quantitative easing to stimulate economy. Nowadays, U.S. keeps interest rate at 0.25%, European Central Bank keeps at 0.05%, and Japan keeps at 0.1%, which are at the lowest rate in the history.
As a result, in this aging society, Taiwanese prefer to invest endowment insurance for their retiring plan. Moreover, if we take global economy into consideration, when interest rate starts rising, the Interest-sensitive Insurance products will be affected. But the consequence is positive.
In conclusion, in order to on the right track of consumer behavior on endowment insurance at this stage, I will analysis Interest-Sensitive Insurance’s product structure and compare the differences between insurance’s Declaimed rate, 2-Year time saving deposits rate at bank, and the U.S. 10-Year Treasury Constant Maturity Rate to demonstrate the Pro’s and Con’s of Interest-Sensitive Insurance.
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