Economists, regulators, and consumer protection agencies have highlighted the welfare losses for consumers who purchase high-load insurance against modest stakes risks. Mandatory information disclosure is a potentially attractive public policy tool that might improve consumers' choices, but has...

We analyze insurance demand experiments conducted in two different settings: in-person at a university laboratory and online using Amazon's Mechanical Turk crowdworking platform ("MTurk"). Subject demographics differ significantly across the samples, but average insurance demand is similar....

Probability weighting is often used to explain insurance choices that conflict with expected utility (EU) preferences. We derive new theoretical results on the effects of probability weighting in the context of common insurance demand puzzles. We identify decreasing relative overweighting (DRO)...

Can measured risk attitudes and associated structural models predict insurance demand? In an experiment (n = 1,730), we elicit measures of utility curvature, probability weighting, loss aversion, and preference for certainty and use them to parameterize seventeen common structural models (e.g.,...

Can measured risk attitudes and associated structural models predict insurance demand? In an experiment (n = 1,730), we elicit measures of utility curvature, probability weighting, loss aversion, and preference for certainty and use them to parameterize seventeen common structural models (e.g.,...

We examine risk preferences using the flood insurance decisions of over 100,000 households. In each contract, households make a small stakes decision, the deductible, and a large stakes one, the coverage limit. Over 94 percent of household choose one of the two lowest deductibles out of six...