Recently added articles from Journal of Risk and Insurance:
On the possibility of profitable self-selection contracts in competitive insurance markets.
Jun 01, 2009; ... ABSTRACT Several studies extend the Rothschild-Stiglitz model of competitive insurance contracting with adverse selection by incorporating additional dimensions of private information and conclude that some insurers may earn positive profit in a separating, self-selection ...
Time deductibles as screening devices: competitive markets.
Jun 01, 2009; ... ABSTRACT Seminal papers on asymmetric information in competitive insurance markets, analyzing the monetary deductible as a screening device, show that any existing equilibrium is of a separating type. High risks buy complete insurance, whereas low risks buy partial ...
Insurance markets with differential information.
Jun 01, 2009; ... ABSTRACT This article attempts to understand the outcomes when each party of an insurance contract simultaneously has superior information. I assume that policyholders have superior information about specific risks while insurers have superior information about general risks. I ...
Getting feedback on defined contribution pension plans.
Jun 01, 2009; ... ABSTRACT With the growth of private and public defined contribution (DC) pension plans around the world, market rates of return should increasingly play a large role in the retirement patterns of individuals. The reverse could, however, also be true--i.e., a country's ...
Multidimensional credibility with time effects: an application to commercial business lines.
Jun 01, 2009; ... ABSTRACT This article considers Danish insurance business lines for which the pricing methodology has been dramatically upgraded recently. A costly affair, but nevertheless, the benefits greatly exceed the costs; without a proper pricing mechanism, you are simply not ...
Simulation Techniques in Financial Risk Management.(Book review)
Jun 01, 2009; ... Simulation Techniques in Financial Risk Management, by Ngai Hang Chan and Hoi Ying Wong, 2006, John Wiley & Sons, Hoboken, NJ, pp. 240. ISBN: 978-0-471-46987-2 The Wiley InterScience "Statistics in Practice" series aims to provide both practitioners and research workers with ...
Introduction to the special issue on long-term care insurance and health insurance.
Mar 01, 2009; ... The articles published in this special issue cover several dimensions of two insurance markets that are characterized by major imperfections such as high transaction costs, information asymmetries, and low competition. Furthermore, insurance premiums are high and coverage is limited. On ...
The private market for long-term care insurance in the United States: a review of the evidence.
Mar 01, 2009; ... ABSTRACT This article reviews the growing literature on the market for private long-term care insurance, a market notable for its small size despite the fact that long-term care expenses are potentially large and highly uncertain. After summarizing long-term care utilization and ...
Housing, health, and annuities.
Mar 01, 2009; ... ABSTRACT Annuities, long-term care insurance (LTCI), and reverse mortgages appear to offer important consumption smoothing benefits to the elderly, yet private markets for these products are small. A prominent idea is to combine LTCI and annuities to alleviate both supply ...
Asymmetric information, long-term care insurance, and annuities: the case for bundled contracts.
Mar 01, 2009; ... ABSTRACT This article examines the markets for long-term care insurance and annuities when there is asymmetric information and there are costs of administering contracts. Individuals differ in terms of their risk aversion. Risk-averse individuals take more care of their health ...
Issuance decisions and strategic focus: the case of long-term care insurance.
Mar 01, 2009; ... ABSTRACT Increasing costs of long-term care are placing ever greater burdens on state and federal budgets, yet private long-term care insurance remains a relatively minor financing vehicle. Although many researchers provide rationales for the limited private market, some ...
Long-term disability claims rates and the consumption-to-wealth ratio.
Mar 01, 2009; ... ABSTRACT A framework for linking long-term disability (LTD) claims rates to the macro-economy using the consumption-to-wealth ratio is developed from financial economic and option theories. Financial economic theory suggests that the consumption-to-wealth ratio reflects ...
The aggregate demand for private health insurance coverage in the United States.
Mar 01, 2009; ... ABSTRACT This article estimates the aggregate demand for private health insurance coverage in the United States using an error correction model for the period 1966-1999. Both short- and long-run price and income elasticities of demand are estimated. The empirical findings ...
Measuring selection incentives in managed care: evidence from the Massachusetts State employee insurance program.
Mar 01, 2009; ... ABSTRACT Capitation gives insurers incentive to manipulate their offerings to attract the healthy and deter the sick. We calculate the incentives for such service-specific quality distortions using managed care medical and pharmacy spending data for fiscal years 2001 and 2002 ...
Adverse selection, moral hazard, and outlier payment policy.
Mar 01, 2009; ... ABSTRACT In this article, we analyze the rationale for introducing outlier payments into a prospective payment system for hospitals under adverse selection and moral hazard. The payer has only two instruments: a fixed price for patients whose treatment cost is below a threshold ...
The effects of tort reform on medical malpractice insurers' ultimate losses.
Mar 01, 2009; ... ABSTRACT Whereas the literature evaluating the effect of tort reforms has focused on the impact of reforms on insurers' reported incurred losses, this article examines the ultimate effects of reforms using the developed losses from a comprehensive sample of insurers writing ...
Dynamics of the market for medical malpractice insurance.(Report)
Mar 01, 2009; ... ABSTRACT Public attention has been directed recently at the market for medical malpractice insurance, yet disagreement persists over whether this market has changed and, if so, what has caused this change. In this study, we examine factors that affect the market for this ...
The reasonable person negligence standard and liability insurance.
Dec 01, 2008; ... ABSTRACT We show that, under the reasonable person negligence rule, heterogeneity of potential injurers can be sufficient to create a demand for liability insurance. Potential injurers with a low probability of accidents or a high cost of exercising care have optimal levels of ...
Adverse selection with frequency and severity risk: alternative risk-sharing provisions.
Dec 01, 2008; ... ABSTRACT The analysis considers an insurance market with adverse selection where individuals' loss distributions may differ with respect to both the frequency and severity of loss. We show that the combination of deductibles and coinsurance can be used to sort rationed ...
Portfolio choice and life insurance: the CRRA case.(constant relative risk aversion)
Dec 01, 2008; ... ABSTRACT We solve a portfolio choice problem that includes life insurance and labor income under constant relative risk aversion (CRRA) preferences. We focus on the correlation between the dynamics of human capital and financial capital and model the utility of the family as ...