This paper studies the life cycle consumption-investment-insurance problem of a family. The wage earner faces the risk … of a health shock that significantly increases his probability of dying. The family can buy term life insurance with …

stochastic mortality risk and health shock risk numerically. These shocks are interpreted as critical illness and can negatively … affect the expected remaining lifetime, the health expenses, and the income. In order to hedge the health expense effect of a …

-section shows large differences as young, educated, high income, and risk tolerant investors are net buyers throughout and, thus … liquidity shocks from Covid-19 are net sellers. Given the high risk of illness, older people are hit by dual blows to both … health and finances. …

to operate through the effect of poor health on individuals' attitudes toward risk, their planning horizons, or their …This paper analyzes the role that health status plays in household portfolio decisions using data from the Health and … Retirement Study. The results indicate that health is a significant predictor of both the probability of owning different types …