Comparison of Reverse Annuity Contract and Reverse Mortgage on the Polish Market

Dębicka, Joanna; Marciniuk, Agnieszka

doi:10.15611/amse.2014.17.06

Cited by 7 publications

(11 citation statements)

References 9 publications

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“…  (Dębicka and Marciniuk, 2014). Thus, βW is the capital for which the value of benefi t is calculated.…”

Section:  mentioning

confidence: 99%

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Application of Copulas to Modelling of Marriage Reverse Annuity Contract

Dębicka¹,

Heilpern²,

Marciniuk³

2020

Prague Economic Papers

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We model the probabilistic structure and cash flows arising from marriage reverse annuity contracts in the case of the joint-life status and the last surviving status. In contrast to the classical approach, we take into consideration that future lifetimes between spouses are dependent. The structure of dependence of the length of spouses' lives is modelled using copulas. The term structure of interest rate is modelled using a time-dependent function. The numerical results are based on actual Polish data covering both the structure of the probabilistic model and the interest rate.

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“…  (Dębicka and Marciniuk, 2014). Thus, βW is the capital for which the value of benefi t is calculated.…”

Section:  mentioning

confidence: 99%

“…The formula for an annual benefi t in an individual reverse annuity contract is given in Dębicka and Marciniuk (2014). Note that, depending on the status, annuity due benefi ts can be paid in any subset S b of the set space S. In particular, for the marriage reverse annuity contract, S b = {1} for JLS and S b = {1, 2, 3} for LSS.…”

Section:  mentioning

confidence: 99%

Application of Copulas to Modelling of Marriage Reverse Annuity Contract

Dębicka¹,

Heilpern²,

Marciniuk³

2020

Prague Economic Papers

Self Cite

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“…These products are different (cf. Dębicka, Marciniuk, 2014). In case of reverse annuity contract the owner is guaranteed the right to stay in the property until his death by a notarial act.…”

Section: Reversionary Annuitymentioning

confidence: 99%

Marriage Reverse Annuity Contract and Reverse Mortgage – Application of a Generalized Model of Reversionary Annuity

Marciniuk¹

2017

Applications of Mathematics and Statistics in Economics

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The purpose of the paper is applying the generalized model of reversionary annuity to determine the benefit of marriage reverse annuity contracts and reverse mortgages. First of all, benefits depend on the age of spouses, their future lifetime and the real value of their properties which, in turn, determines the place where they live. In addition, the frequency of payments affects the amount of benefit. Therefore, the periodic benefits are determined for some regions of Poland on the basis of real Polish data from 2015, which mostly comes from The Central Statistical Office of Poland. Calculations of annuities are based on the fixed interest rate and the interest rate function depending on time t for Polish real data. The results are later compared.

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“…In the sale model (home reversion scheme), the buyer exchanges the property for the promise of a certain sum at regular intervals, until the buyer dies. According to Dębicka and Marciniuk (2014), Marciniuk (2017), and Marciniuk and Zimková (2018), both products are available in Poland, although equity release is not yet as popular as it is in the USA or the UK.…”

Section: Introductionmentioning

confidence: 99%

“…In Poland, initially the equity release contract was only available to individuals. Marriage life annuities or insurance for married couples was fi rst analysed for Poland by Heilpern (2014) and extended by Luciano et al (2016). These authors considered the dependence between spouses' future lifetimes.…”

Section: Introductionmentioning

confidence: 99%

Valuation of Equity Release Contracts in Czech Republic, Republic of Poland and Slovak Republic

Marciniuk¹,

Zimková²,

Farkašovský³

et al. 2020

Prague Economic Papers

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An ageing European population and, therefore, a rising dependency ratio of retirees to the working population, strongly suggests that a pension funding gap will be a key social issue in future. Yet many older people have significant real estate assets that they could access using equity release products. They could sell their assets in exchange for lifelong or temporary monthly payments. Equity release products are relatively new to Poland, but are not yet offered by commercial banks in Czechia and Slovakia. This paper estimates the potential benefits of marriage reverse annuity, and reverse mortgage contracts, using the Svensson model function, and empirical property data from selected Czech, Slovak and Polish cities. The results are also compared to the average pension of inhabitants in the selected cities. It is shown that there is substantial scope for boosting retirement income in all the cases considered, though the precise size of the increase depends on factors such as contract buyers' age and life expectancy, the value of their assets, the payment consequences of a spouse's death, and contract suppliers' pricing policies.

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Comparison of Reverse Annuity Contract and Reverse Mortgage on the Polish Market

Abstract: Front page design Grzegorz Rogoziński CD cover design Beata DębskaArticles published in the form submitted by the authors All rights reserved. No part of this book may be reproduced in any form or in any means without the prior permission in writing of the Publisher

Cited by 7 publications

References 9 publications

Application of Copulas to Modelling of Marriage Reverse Annuity Contract

Application of Copulas to Modelling of Marriage Reverse Annuity Contract

Marriage Reverse Annuity Contract and Reverse Mortgage – Application of a Generalized Model of Reversionary Annuity

Valuation of Equity Release Contracts in Czech Republic, Republic of Poland and Slovak Republic

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