We analyze mutual insurance arrangements (policies based on risk-sharing among a pool of policyholders) when consumers choose a self-insurance effort, that is an effort decreasing the size of any loss occurring. We consider both cooperative and non-cooperative strategies in the effort choice....

We develop a model where consumers do not have ex-ante private information on their risk but can decide to acquire such information before insurance policy purchase. Adverse selection can arise endogenouslyin the insurance market. We focus on the case where information has decision-making value:...