USING LINEAR PROGRAMMING FOR PLANNING LIFE INSURANCE PURCHASES*
开发了一个线性规划模型，帮助个人在有限时间范围内，通过优化人寿保险和自保险的组合来最大化净现值，并满足每期的死亡抚恤金要求。
Abstract In this paper a linear programming model is developed to address problems that arise in estate planning and personal life insurance management. The objective is to maximize net present value resulting from the optimal combination of life insurance and self‐insurance, subject to a budget constraint in each period of a finite horizon. In addition, a death‐benefit requirement must be satisfied in each period. The model is sufficiently flexible to include both term and whole life (cash value) insurance, self‐insurance (alternative investment), policy loans, and buy back (cancellation) amounts in each period. By modifying the budgets and requirements, the model provides useful information related to interest‐adjusted cost and marginal rate of return which can then be used to compare different policies. Numerical examples are presented to demonstrate the technique.