When a party seeks to pass a risk to another in a market transaction it typically must first provide information about the risk to the potential risk bearer, who determines whether to accept the risk and if so at what price. In the current paper, we examine the demand for underwriting and its...

In this article, we establish a model of competitive insurance markets based on Rothschild and Stiglitz (1976) where insurers can perform risk classification tests either before insurance contracts are issued (underwriting) or when coverage claims are filed (post-loss test). However, insurers...