Please use this identifier to cite or link to this item: https://hdl.handle.net/10356/147347
Title: The practical rationality of purchasing life insurance
Authors: Yeo, Jasper Bo Wen
Keywords: Humanities::Philosophy
Issue Date: 2021
Publisher: Nanyang Technological University
Source: Yeo, J. B. W. (2021). The practical rationality of purchasing life insurance. Final Year Project (FYP), Nanyang Technological University, Singapore. https://hdl.handle.net/10356/147347
Abstract: Why do people purchase life insurance? If they do, then, is it rational for them to purchase life insurance? In this paper, I will address the intricacies of utilising decision theory as a means to rationally decide if one ought to purchase life insurance or not. I will argue that primarily through the use of expected utility value and the increasing marginal disutility of lost money, it is rational for agents, practically speaking, to purchase life insurance because they will be better-off with than without it. Whilst there may exist agents who, in their non-conformity to the increasing marginal disutility of lost money, may rationally be better-off without life insurance than with it, they are merely outliers. I will prove my thesis in two parts: I will show that it is rational to purchase critical illness coverage, and I will show that it is rational to purchase death coverage, therefore it is rational to purchase life insurance, a combination of the two. I will then propose a possible further research study into the practical rationality of not just life insurances, but also personal insurances using the same justifications for the rationality of purchasing life insurance.
URI: https://hdl.handle.net/10356/147347
Fulltext Permission: restricted
Fulltext Availability: With Fulltext
Appears in Collections:SoH Student Reports (FYP/IA/PA/PI)

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