Simwa, Richard OnyinoOnyango, FredrickOdiwuor, Calvine2025-05-262025-05-262020Simwa, R. O., Onyango, F., & Odiwuor, C. (2020). Approximations of Ruin Probabilities Under Financial Constraints. Hikari Ltd.https://repository.daystar.ac.ke/handle/123456789/6774Journal ArticleIn this paper, we investigate the approximate ruin probabilities under financial constraints (interest rate, inflation, and taxation). We formulate a risk process whose premium inflow is influenced by the economic effects of inflation and interest rate. Thereafter we invoke the Albrecher-Hipp loss-carried-forward tax scheme from which an exact formula for the ruin probability for exponentially distributed claims is derived. Finally, an explicit asymptotic formula when the claims have sub-exponential distribution is also derived using the PollaczekKhintchine formula.enRuin probabilityRisk ProcessFinancial ConstraintsSubexponential distribution.Article