Optimal insurance design of ambiguous risks
WebWe examine the characteristics of the optimal insurance contract under linear transaction costs and an ambiguous distribution of losses. Under the standard expected utility model, we know from Arrow (1965) that it contains a straight deductible. In this paper, we assume that the policyholder is ambiguity averse in the sense of Klibanoff et al. (Econometrica … WebChristian Gollier, “Optimal insurance design of ambiguous risks”, TSE Working Paper, n. 12-303, May 2012, revised January 2013.
Optimal insurance design of ambiguous risks
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WebMay 11, 2024 · This paper presents analytical representations for an optimal insurance contract under distortion risk measure and in the presence of model uncertainty. We … WebAmbiguity Ambiguous averse forest owners will select higher insurance premiums and Insurance for a risk with ambiguous probability than for a risk with non-ambiguous probability. 3 Experimental design We designed an experiment to test the predictions of the theoretical model of insurance behavior introduced in the previous section. 3.1 Stimuli We …
WebIn problems of optimal insurance design, Arrow’s classical result on the optimality of the deductible indemnity schedule holds in a situation where the insurer is a risk-neutral Expected-Utility (EU) maximizer, the insured is a risk-averse EU-maximizer, and the two parties share the same probabilistic beliefs about the realizations of the … WebOptimal insurance design of ambiguous risks Christian Gollier1 Toulouse School of Economics (LERNA, University of Toulouse) January 21, 2013 Abstract We examine the characteristics of the optimal insurance contract under linear transaction cost and an ambiguous distribution of losses. Under the standard expected utility model, we know
Web560 C. Gollier The generalization of this result in the case of ambiguity aversion can be summarized as follows. Proposition 2 When τ = 0, the optimal contract entails full insurance, i.e.,I(x) = x for all x. When τ>0, there exists a subset of losses of positive measure G such that I(x) = 0. Proof Whenτ = 0,itiseasytocheckthatthefirst-orderconditions(10)and(11)are WebOptimal insurance design of ambiguous risks 557 tract when the distribution of losses is ambiguous and the policyholder is ambiguity averse.1 …
WebChristian Gollier, “Optimal insurance design of ambiguous risks”, Economic Theory, Springer Berlin / Heidelberg, vol. 57, n. 3, November 2014, pp. 555–576. Optimal insurance design …
WebWe also show that the policyholder’s ambiguity aversion may have the counterintuitive effect to reduce the optimal insurance coverage of an ambiguous risk. We examine the … new england faculty development consortiumWebJan 30, 2015 · In this paper, we examine the problem of optimal insurance design with a minimum expected retention constraint, in the case where the insurer is ambiguity … new england fall bucket listnew england fall foliage 2016 datesWebFeb 1, 2015 · My last few clients had not used actuaries in 20 years of Insurance Buying. When they did, the results were transformative, Reducing Premiums Substantially, Safely & Strategically. I am an independent actuarial advisor to insurance buyers with more than 20 years of experience in this field. During this time I have completed over 200 projects for … new england fairs 2023WebOptimal insurance design of ambiguous risks. Christian Gollier () No 718, IDEI Working Papers from Institut d'Économie Industrielle (IDEI), Toulouse. Abstract: We examine the … interphase step where cell replicates dnaWebThe demand for optimal insurance decreases when there is an aversion to ambiguity or risk. The insurance contracts showed that ambiguity exists and creates challenges to contract laws. Moreover, articles focusing on legal aspects and how the legal system handles ambiguity in the U.S. courts were aligned with the first cluster on ambiguity keywords. new england falconry hadleyWebDec 1, 2024 · This paper provides the results of an experiment on the willingness to pool genetic risk in health insurance. Subjects’ overall health risk has an assigned, … interphase stages pictures