contracts causes individuals to be uncertain about insurance payouts. As a result, a trade-off between second-order (risk … aversion) and third-order (prudence) risk preferences drives insurance demand. Very prudent individuals desire more insurance …We study insurance markets with individuals that have limited financial literacy. In our model, complexity of insurance …

-impact risks or for insurance contracts exposed to nonperformance risk …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 …

high-load insurance against modest stakes risks. Mandatory information disclosure is a potentially attractive public policy … tool that might improve consumers' choices, but has not been widely tested in insurance settings. We conduct an incentive …-compatible insurance demand experiment in which we manipulate the information disclosed to subjects. We test whether any of the three most …

Weather is a major source of income risk, especially in low-income environments. This paper uses data from randomized … insurance product is affected by product priming that emphasizes insurance value to a family and group identity. We document … that such product priming makes individuals (i) less sensitive to basis risk, but (ii) more sensitive to price, with an …

when risk is involved, even when full information is available. A simple normative analysis of decisions about insurance …Consumers face many decisions involving risk, yet some researchers claim that consumers cannot make rational decisions … consumers to choose insurance policies with higher deductibles. Possible computer expert systems to help consumers make …

problems and provide coverage for catastrophic risks. Insurance premiums based on risk provide signals to residents and … their risk. To address issues of equity and fairness, homeowners who cannot afford insurance could be given vouchers tied to …This paper describes the challenges consumers, insurers and insurance regulators face in dealing with insurance for low …

Risk management is now present in many economic sectors. This paper investigates the role of risk management in … financial intermediaries whose primary role in the economy is risk pooling and risk bearing. The risk pooling and risk bearing … functions performed by insurers are the primary determinants of the need for risk management. The main goal of this paper is to …

defining a meaningful role for insurance in managing business interruption (BI) and other risks from future pandemics. The … insurance industry will be part of that solution set, whether through the continued development of ad hoc state …-by-state initiatives, a private-public partnership in which the insurance industry commits its servicing capabilities, or a private …

People often fail to insure against catastrophes, even when insurance is subsidized. Even when insuring homes, many … homeowners still underinsure the full value of their assets. Some researchers have suggested using long-term insurance contracts … to reduce these insurance gaps. We examine insurance decisions in a computer-administered experiment that makes several …

We use data on insurance deductible choices to estimate a structural model of risky choice that incorporates 'standard …' risk aversion (diminishing marginal utility for wealth) and probability distortions. We find that probability distortions … important role in explaining the aversion to risk manifested in deductible choices. This finding is robust to allowing for …