The effect of life insurance settlement on insurance market and consumer welfare

Hong, Jimin The Korean Statistical Society 2020 Communications for statistical applications and me Vol.27 No.6

This study investigates the effect of life settlement on the monopolistic insurance market. In particular, we consider liquidity cost, which is the cost incurred to the insurer to meet the request of surrender, and trading cost, which is the transaction cost of the policyholders for the settlement. We first show that the introduction of a life settlement can increase insurance demand and enhance consumer welfare even when the trading cost is higher than the liquidity cost. That is, even if the settlement market is less efficient than the insurance market, both insurance demand and consumer welfare can be increased. Second, the insurer's profit can also be increased when settlement is introduced because not only can the insurer save the liquidity cost but also the demand of insurance increases. Lastly, insurance demand does not always decrease when both costs increase. Depending on the population distribution over the liquidity risk, the demand of insurance can be increased or decreased.

Process design for cellulosic ethanol production from lignocellulosic biomass

Jimin Hong(홍지민),Le Cao Nhien(레카오니엔),Nguyen Van Duc Long(구웬롱),Le Quang Minh(레민쿠앙),Pham Ngoc Tram(팜녹트램),Moonyong Lee(이문용) 한국에너지기후변화학회 2016 한국에너지기후변화학회 학술대회 Vol.2016 No.11

The optimal insurance demand under an ambiguity aversion

( Jimin Hong ) 한국파생상품학회 2022 선물연구 Vol.30 No.4

This study investigates insurance demand in a two-period model when a decision-maker (DM) is averse to the ambiguity of loss distributions. This study derives sufficient conditions such that the ambiguity-averse DM purchases more insurance than an ambiguity-neutral one when the DM maximises the expected utility. It also derives each sufficient condition to increase insurance demand as ambiguity aversion, ambiguity and downside ambiguity increase, respectively.

Life Insurance Settlement and the Monopolistic Insurance Market

Jimin Hong,S. Hun Seog 한국재무학회 2013 한국재무학회 학술대회 Vol.2013 No.11

We analyze the effects of life insurance settlement on the insurer’s profit and the consumer and social welfares. We consider a one-period model in which the insurance market is monopolistic and the settlement market is competitive. Policyholders face heterogeneous liquidity risks in addition to mortality risks. Liquidity risks are introduced to address the case in which policyholders need urgent cash, leading them to surrender or settle the policies. It is assumed that the insurer cannot observe the liquidity risks nor discriminate policyholders based on the liquidity risks. It is further assumed that no costs are incurred in policy surrender or settlement. We find that the introduction of the life settlement market lowers the monopolistic rent while raising the premium. The effects on consumer welfare and social welfare are mixed. Consumer welfare increases only when the demand sufficiently increases. This finding implies that social welfare, as measured by the sum of consumer welfare and the insurer's profit, can increase if the increase in the consumer welfare is greater than the decrease in the insurer's profit. This finding is contrasted with the existing literature in which the settlement market lowers social welfare.

Design and optimization of multi-effect-evaporation-assisted distillation configuration for recovery of 2,3-butanediol from fermentation broth

Hong, Jimin,Van Duc Long, Nguyen,Harvianto, Gregorius Rionugroho,Haider, Junaid,Lee, Moonyong Elsevier 2019 Chemical engineering and processing Vol.136 No.-

<P><B>Abstract</B></P> <P>2,3-butanediol (2,3-BDO) is a precious chemical owing to its extensive industry applications. In addition to the traditional chemical synthesis, the production of 2,3-BDO from biomass-based feedstock is an attractive alternative. Nevertheless, this production way consumes considerable energy because the concentration of product from the conversion of biomass is low. In this study, several novel multi-effect-evaporation-assisted distillation (MEED) configurations are proposed to improve the energy efficiency of 2,3-BDO production from a fermentation broth. The binary interaction parameters between 2,3-BDO and water were determined through regression using experimental data. All configurations were designed and optimized using the sequential quadratic programming methodology. The results indicate that the proposed MEED configurations can create the synergistic effect by combining the multi-effect evaporator and distillation processes, which is able to increase substantial energy efficiency as compared the conventional distillation column. Notably, the total annual cost (TAC) of the MEED configurations with double effect, triple effect, quadruple effect, quintuple effect, and sextuple effect can be reduced by up to 12.3%, 16.9%, 20.1%, 21.7%, and 17.5%, respectively. The proposed MEED configuration with heat integration significantly reduced the TAC by up to 38.9%. Furthermore, CO<SUB>2</SUB> emissions were estimated and compared between a conventional column and the suggested configurations.</P> <P><B>Highlights</B></P> <P> <UL> <LI> Several innovative MEED configurations were proposed. </LI> <LI> A synergetic advantage of enhancing energy efficiency. </LI> <LI> SQP is an effective tool to optimize the structure of a complex configuration. </LI> <LI> An efficient biorefinery design was proposed for the 2,3-BDO purification process. </LI> <LI> TAC can be saved up to 38.9%. </LI> </UL> </P> <P><B>Graphical abstract</B></P> <P>[DISPLAY OMISSION]</P>

Risk Factors of Failure to Rescue in Unplanned ICU Admitted Patients after Elective Pancreatectomy

Jimin Son,Ki Byung Song,Ye Won Jeon,Janghun Han,Min Kyu Sung,Yuna Lee,Younghoon Roh,Sarang Hong,Yejong Park,Bong Jun Kwak,Woohyung Lee,Jae Hoon Lee,Dae Wook Hwang,Song Cheol Kim,Suk-kyung Hong 대한외과학회 2022 대한외과학회 학술대회 초록집 Vol.2022 No.11

Moral Hazard and State Dependent Utility with Loss Reduction

Jimin Hong,S. Hun Seog 한국재무학회 2014 한국재무학회 학술대회 Vol.2014 No.05

In this study, we consider a state dependent utility under moral hazard focusing on the loss reduction effort. We assume a two state model: loss occurrence state and no loss occurrence state. According to the marginal utility of income on the states, we analyze the optimal insurance coverage. If the marginal utility of income is equal between the two states, the optimal indemnity and effort level are identical with the state independent utility case. Optimal insurance involves full insurance up to a limit and coinsurance above the limit. If the marginal utility of income in the loss state is larger than that of income in no loss state, then the optimal insurance include full insurance. On the contrary, if the relation is the reverse between the marginal utilities, then the optimal insurance includes the deductible up to a limit and coinsurance above the limit. In this case, full insurance can be also involved. This paper investigates whether the moral hazard is more or less severe under a state dependent utility as well. As a result, if the indemnity level is equal to the indemnity under state independent utility, the effort is higher than that of state independent utility when the marginal utility of income in the loss state is larger than that of the income in no loss state. That is, the moral hazard problem may be less severe. In contrary to this, moral hazard can be more severe when the marginal utility of the income in the loss state is lower than that of the income in no loss state. We apply the state dependent model to the debt contract model. The cost function is state dependent, the interest rate can be lower and the moral hazard problem may not be significant. The reverse case can be also possible depending on the marginal cost.

Insurance against Bundled Risks with an Application to Microinsurance

Jimin Hong,S. Hun Seog 한국재무학회 2018 한국재무학회 학술대회 Vol.2018 No.05

We analyze the medical treatment choices and the demand for health insurance in a theoretical setting. Experiencing health losses, individuals may select from no, low, or high levels of medical treatment. High level treatment is interpreted as a bundling of low level treatment and additional treatment. Insurance against bundled risks implies that it covers against high level treatment only. Insurance is assumed to be actuarially fair.We find that the low-wealth individuals tend to select no treatment and purchase no insurance. The mediumwealth individuals select low treatment and purchase partial insurance. The high-wealth individuals select high treatment and purchase full insurance. The relation between wealth and coverage is not necessarily monotonic. We apply the findings to microinsurance and discuss the theoretical implications of microinsurance.

저고도 전리권 관측을 위한 사운딩 로켓 실험용 IAMMAP(Ionospheric Anomaly Monitoring by Magnetometer And Plasma-Probe)의 과학적 목표와 임무 설계

Jimin Hong,Yoon Shin,Sebum Chun,Sangwoo Youk,Jinkyu Kim,Wonho Cha,Seongog Park,Seunguk Lee1,Suhwan Park,Jeong-Heon Kim,KWANG-SUN RYU 한국우주과학회 2024 우주기술과 응용 Vol.4 No.2

Sounding rockets are cost-effective and rapidly deployable tools for directly exploring the ionosphere and microgravity environments. These rockets achieve their target altitudes quickly and are equipped with various scientific instruments to collect real-time data. Perigee Aerospace plans its inaugural test launch in the first half of 2024, followed by a second performance test launch in January 2025. The second launch, scheduled off the coast of Jeju Island, aims to reach an altitude of approximately 150 km with a payload of 30 kg, conducting various experiments in the suborbital region. Particularly in mid-latitude regions, the ionosphere sporadically exhibits increased electron densities in the sporadic E layers and magnetic fluctuations caused by the equatorial electrojet. To measure these phenomena, the sounding rocket version of ionospheric anomaly monitoring by magnetometer and plasma-probe (IAMMAP), currently under development at the KAIST Satellite Research Center, will be onboard. This study focuses on enhancing our understanding of the mid-latitude ionosphere and designing observable missions for the forthcoming performance tests. 사운딩 로켓은 저렴한 비용과 빠른 개발 기간을 통해 전리권이나 무중력 환경을 직접 탐사하는 유용한 도구이다. 이러한 로켓은 목표 고도에 신속하게 도달하며, 다양한 과학적 장비를 탑재하여 데이터를 실시간으로 수집할 수 있다. 페리지에어로스페이스㈜는 2024년 상반기에 첫 시험 발사를 진행한 뒤, 2025년 1월경에는 2차 성능시험 사운딩 로켓을 발사할 예정이다. 이 로켓은 제주 해상에서 발사될 예정이며, 약 150 km의 목표 고도에 총 30 kg의 탑재체를 싣고, 준궤도 영역에서 다양한 실험을 수행할 것이다. 특히, 중위도 지역의 전리권에서는 간헐적으로 전자 밀도가 증가하는 스포라딕 E층과 적도 전기제트에 의한 자기장의 미세변화를 관측할 수 있을 것으로 예상된다. 이러한 관측을 위해 KAIST 인공위성연구소에서 개발 중인 탑재체 IAMMAP(ionospheric anomaly monitoring by magnetometer and plasma-probe)의 사운딩로켓 버전이 발사체에 실릴 예정이다. 본 연구는 중위도 지역의 전리권에 대해서 이해하고, 2차 성능시험에서의 관측 가능한 임무 설계에 중점을 두고자 한다.

건강보험에서 피보험자와 의료서비스 공급자 양쪽의 도덕적 해이가 의료서비스 이용에 미치는 영향

홍지민 ( Jimin Hong ) 한국보험학회 2018 保險學會誌 Vol.115 No.-

본 연구는 건강보험에서의 도덕적 해이 문제가 피보험자 및 의료서비스 공급자 각각에게 존재하거나, 양쪽 모두에게 존재할 때 최적보험을 살펴보고 있다. 그 결과 첫째, 양자 모두에게 도덕적 해이가 존재하지 않는 경우 최적보험은 완전보험이다. 둘째, 피보험자에게만 도덕적 해이가 존재하는 경우 일부보험이 최적이다. 반면 의료서비스공급자에게만 도덕적 해이가 존재하는 경우 완전보험이 최적이다. 한편 이때의 의료서비스 이용량은 효용함수 및 건강회복도, 의료서비스 공급자의 비용함수 등에 따라 전자 또는 후자가 더 클 수 있다. 셋째, 보험자가 의료서비스 공급자의 도덕적 해이를 통제하기 위해 진료비 체계를 디자인할 수 있다면 도덕적 해이를 줄이기 위해서는 고정 보수를 지급하는 방식이 최적이다. 그러나 이는 공급자의 노력을 감소시켜 의료서비스를 과소 공급하는 문제를 불러일으킬 수 있다. 넷째, 양자에게 도덕적 해이가 존재한다면, 이 경우의 의료서비스 이용량은 피보험자 또는 의료서비스 공급자 한쪽에만 도덕적 해이가 존재하는 경우에 비해 높거나 낮을 수 있다. 특히 양쪽의 효과가 서로 상쇄되어 더 낮아질 수 있어 도덕적 해이를 단순히 과잉진료의 문제로 보기 어렵다는 것을 의미한다. This study analyzes the optimal insurance contract in health insurance when moral hazard exists in insureds and medical service providers. Three cases are considered: when moral hazard exists only in insureds, when moral hazard exists only in medical service providers, when moral hazard exists in both sides. We first find that the optimal insurance is full insurance without moral hazard. Second, the optimal insurance is partial insurance in the first case, whereas full insurance is optimal in the second case. The medical service consumption of the former case can be greater or less than that of the latter case depending on the utility function, health recovery and cost function of the providers. Third, the insurer can design the treatment fee system, then the fixed payment system is optimal to reduce moral hazard of the providers. Howerver, the system may decrease the provider’s effort and consequently, the supply of medical service may decrease as well. Lastly, the consumption of medical service for the last case can be greater or less than that of the other cases. In particular, it is difficult to regard the moral hazard as the overtreatment since the effect of moral hazard of both sides can be offset.