Analyzing legal regulations in the Norwegian life insurance business using a multistage asset–liability management model

The legal regulations for the life insurance business in Norway have recently been, and still are, under revision. The government's intention is to secure the interests of the customers in life insurance companies. However, there has been debate as to whether the regulations really are in the customers' best interest. We apply an asset–liability management model to analyze the implications of the regulations. The model is multistage, stochastic and integrates assets and liabilities. We employ a four stage model to analyze the legal regulations, and conclude that the current legal framework is not in the insurance holders' best interests.