We develop a test for adverse selection and use it to examine private health insurance markets. In contrast to earlier papers that consider a purely private system or a system in which private insurance supplements a public system, we focus our attention on a system where privately funded health...

Determining a premium for an insured person in an insurance company takes under consideration many factors, such as the size and profitability of the insurance company. By standard insurance theory, the total premium is given by p 3 σ/√n when n is the number of assured members, p is the net...