ABSTRACT
In this chapter we wish to offer an overview or perspective on our study as well as to indicate areas for further work. The focus of the study has been to take the life insurance industry as a sector rather than to adopt a company or cross-section approach. We set ourselves the task within this context of marshalling the facts on the portfolio composition of life offices, including their position in financial markets and examining the principles which appeared to underlie the investment process. We then set out to model their net acquisition utilising as much of the behavioural inputs as we could. In this last respect we are following many other researchers in the field of financial institutions, including ourselves, but we indicated the lack of work on the life insurance sector. This has been both a handicap and an advantage. It has been an advantage in that there has been virtually no work to survey and this has forced us back, as it were, to first principles and necessitated the building block approach which is what we have attempted to do in this present study. The handicaps have been that this has involved us in a lot of description and analysis before we felt we could start any econometric work. In consequence the study is perhaps longer than we might have expected a priori and in addition it is weighted differently. In other words a similar study of banks would have involved a far greater analysis of other empirical work by virtue of the abundance of the literature, particularly in the USA.
