Vittas, Dimitri2012-03-192012-03-192011-08-01https://hdl.handle.net/10986/3524This paper discusses the mechanics and regulation of participating and unit-linked variable payout annuities. These annuities offer benefits that are not fixed in either nominal or real terms but depend on the performance of the fund or funds in which the underlying reserve assets are invested, their profit sharing features, and the treatment of longevity risk. The paper focuses on the treatment of investment and longevity risks by different types of these annuities and underscores the challenge of establishing a robust and effective framework of regulation and supervision for these products. The paper also addresses the exposure of annuitants to integrity risk and places special emphasis on the need for a high level of meaningful transparency.CC BY 3.0 IGOACCOUNTINGACCOUNTING STANDARDSACCUMULATED SAVINGSACTIVE MARKETSACTUARIESADVERSE SELECTIONAFFILIATED ORGANIZATIONSAGENTSANNUAL RETURNSANNUITYANNUITY FACTORANNUITY MARKETANNUITY MARKETSANNUITY PAYMENTSANNUITY PROVIDERSASSET MANAGEMENTASSET MANAGERSASSET PORTFOLIOSASSET PRICESASSETSBANKRUPTCYBANKRUPTCY RISKBASIC PENSIONBENEFIT PAYMENTSBEQUESTBEQUESTSBONDBOND MARKETSBROKERBROKERSCAPITAL REQUIREMENTSCOMMISSIONSCONFLICTS OF INTERESTCONSUMER PROTECTIONCONSUMERSCORPORATE BONDSCOST OF CAPITALDEVELOPING COUNTRIESDISCLOSUREDISCOUNT RATEDISCOUNT RATESEQUITIESEQUITY CAPITALEQUITY MARKETSEQUITY RETURNSEQUITY RISK PREMIUMFAIR VALUEFINANCIAL MANAGEMENTFINANCIAL MARKETFINANCIAL MARKETSFINANCIAL PERFORMANCEFINANCIAL RISKSFINANCIAL SECTOR DEVELOPMENTFIXED ANNUITIESFIXED INCOMEFIXED LIABILITIESFUNDED COMPONENTFUNDED PENSIONFUTURE MORTALITY IMPROVEMENTSFUTURE PAYMENTSGOVERNMENT BONDSGOVERNMENT GUARANTEESGOVERNMENT REGULATIONGUARANTEED BENEFITGUARANTEED BENEFITSGUARANTEED PERIODSGUARANTEED RATESHEALTH STATUSINCOME BONDSINCOME SECURITYINDEXED ANNUITIESINDIVIDUAL ACCOUNTSINDIVIDUAL INVESTORSINFLATIONINFLATION RISKINFLATION RISKSINFORMED DECISIONSINSURANCEINSURANCE COMPANIESINSURANCE MARKETSINTEGRITYINTEREST RATEINTEREST RATE SWAPSINTEREST RATESINTERNATIONAL BANKINVESTINGINVESTMENT FUNDINVESTMENT FUNDSINVESTMENT INCOMEINVESTMENT OBJECTIVEINVESTMENT PERFORMANCEINVESTMENT PRODUCTSINVESTMENT RATEINVESTMENT RETURNINVESTMENT RETURNSINVESTMENT RISKINVESTMENT RISKSINVESTMENT STRATEGYLABOR MARKETLACK OF TRANSPARENCYLEVEL OF RISKLIABILITYLIFE ANNUITIESLIFE EXPECTANCYLIFE INSURANCELIFE INSURANCE POLICIESLIQUIDITYLOCAL MARKETSLONG-TERM CARELONG-TERM INVESTMENTSLONGEVITY ADJUSTMENTLONGEVITY INSURANCELONGEVITY RISKLONGEVITY RISKSLOW INFLATIONMARKET COMPETITIONMARKET CONCENTRATIONMARKET LEVELSMARKET PRACTITIONERSMARKET PRICESMARKET REGULATORSMARKET RETURNSMARKET SHAREMARKET STRUCTUREMARKET TRANSPARENCYMARKET VALUESMATURITYMINIMUM BENEFITSMORTALITYMORTALITY TABLEMORTALITY TABLESMORTGAGEMORTGAGE BONDSMUTUAL INSURANCE COMPANIESOCCUPATIONAL SCHEMEOLDER PERSONSPAYOUTPENSIONPENSION BENEFITSPENSION FUNDSPENSION SCHEMEPENSION SCHEMESPENSION SYSTEMPENSION SYSTEMSPENSIONERSPENSIONSPERSONAL PENSIONPERSONAL PENSION PLANSPERSONAL PENSIONSPOLICYHOLDERSPORTFOLIOPRIVATE PILLARPROFIT SHARINGPRUDENTIAL REGULATIONPUBLIC PENSIONPUBLIC PILLARPUBLIC PILLARSRATE OF RETURNRATES OF INTERESTRATES OF RETURNREGULAR PAYMENTSREGULATORY AGENCIESREGULATORY AUTHORITIESREGULATORY AUTHORITYREGULATORY FRAMEWORKREGULATORY SYSTEMSREINSURANCERESERVERESERVESRETIREESRETIREMENTRETIREMENT ASSETRETIREMENT INCOMERETIREMENT PRODUCTSRETIREMENT SAVINGRETIREMENT SAVINGSRETIREMENT SAVINGS PLANSRETIRING WORKERSRETURNSRETURNS ON EQUITIESRISK EXPOSURERISK MANAGEMENTRISK PREMIUMRISK PROFILESSAVINGSSECURITIESSECURITIES MARKETSSHAREHOLDERSSOLVENCYSUPERVISORY FRAMEWORKSUPPLEMENTARY PENSIONSURVIVAL BIASTAXTAX ADVANTAGESTRANSFER FEESTRANSPARENCYUNISEX TABLESUSE OF DERIVATIVESVALUATIONVALUATIONSVARIABLE ANNUITIESWITHDRAWALYIELD CURVEWorld Bank10.1596/1813-9450-5762