|Title:||Disappointment and the optimal insurance contract||Authors:||Huang R.J.
|Keywords:||coinsurance;deductible;disappointment;optimal insurance contract||Issue Date:||2012||Journal Volume:||37||Journal Issue:||2||Start page/Pages:||258-284||Source:||GENEVA Risk and Insurance Review||Abstract:||
This paper studies the optimal insurance contract under disappointment theory. We show that, when the individuals anticipate disappointment, there are two types of optimal insurance contract. The first type contains a deductible and a coinsurance above the deductible. We find that zero marginal cost is just a sufficient but not a necessary condition for a zero deductible. The second type has no deductible and the optimal insurance starts with full coverage for small losses and includes a coinsurance above an upper value of the full coverage. ? 2012 The International Association for the Study of Insurance Economics.
|Appears in Collections:||財務金融學系|
|Huang2012_Article_DisappointmentAndTheOptimalIns.pdf||520.3 kB||Adobe PDF||View/Open|
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