Rationality of Life Insurance Behavior under Economic Uncertainty

Abstract

Uncertain economic situations like shock, crisis, and fall impact significantly on the personal investments, main of them are life insurance and savings. Taking into account the importance of precautionary life insurance and savings as the future buffers due to current ambiguity, it is essential to understand individuals' behavior regarding to the economic uncertainty. This article studies macroeconomic, social, and insurance indicators and its impact life insurance in Russia. We found the supportive arguments both rational and irrational customers' actions. The justification of discovered contradictory life insurance behavior lies on the bounded or local rationality and its assumptions that can be useful to the participants of insurance markets, policymakers.