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Making Financial Uncertainty Count: Unit‐Linked Insurance, Investment and the Individualisation of Financial Risk in British Life Insurance

MPS-Authors
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van der Heide,  Arjen
Soziologie öffentlicher Finanzen und Schulden, MPI for the Study of Societies, Max Planck Society;

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BJS_71_2020_vanderHeide.pdf
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Citation

van der Heide, A. (2020). Making Financial Uncertainty Count: Unit‐Linked Insurance, Investment and the Individualisation of Financial Risk in British Life Insurance. British Journal of Sociology, 71(5), 985-999. doi:10.1111/1468-4446.12783.


Cite as: http://hdl.handle.net/21.11116/0000-0007-008C-B
Abstract
While most scholarship in the sociology of insurance has focused on the making of insurance risk by investigating mechanisms of pooling and spreading, this article examines insurers’ management of financial uncertainty. Based on a large corpus of written sources and 44 semi‐structured oral history interviews, this article seeks to describe and explain a shift in how financial uncertainty is dealt with in British life insurance, away from traditional multipolar arrangements revolving around actuarial prudence and discretion, towards bipolar arrangements that rely on explicit risk quantification and the logic of risk‐based capital to “individualise” financial risk. The article identifies two factors that were key in bringing about this shift: first, the competitive dynamics that unfolded with the emergence of challenger “unit‐linked” insurers in the 1960s, and, second, changes in the professional ecology, as manifested by the changing relations between the actuarial profession and insurance supervisors.