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on Insurance Economics |
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Issue of 2008‒05‒31
three papers chosen by Soumitra K Mallick Indian Institute of Social Welfare and Bussiness Management |
| By: | Daniel G. Schroeder |
| Abstract: | Food Stamps (FS) and cash assistance were reformed in 1996 and later to emphasize work as a route out of poverty. When employment opportunities were plentiful, as they were during the late 1990s, many families were able to transition off program rolls and into jobs. However, when the employment situation reversed starting in 2000, social supports were needed. This study attempts to determine whether Unemployment Insurance (UI) was a significant source of support for these families, as might be expected because many former welfare recipients should have developed work histories that would have made them eligible for UI benefits. In particular, the study asks whether UI was able to replace or complement food stamps for unemployed, welfare-eligible families. |
| Keywords: | food stamp, welfare, unemployment insurance |
| Date: | 2007–05 |
| URL: | http://d.repec.org/n?u=RePEc:har:wpaper:0715&r=ias |
| By: | Lindset, Snorre (Trondheim Business School); Persson, Svein-Arne (Dept. of Finance and Management Science, Norwegian School of Economics and Business Administration) |
| Abstract: | We present a model for pricing credit risk protection for a limited liability non-life insurance company. The protection is typically provided by a guaranty fund. In the case of continuous monitoring, i.e., where the market values of the company's assets and liabilities are continuously observable, and where the market values of assets and liabilities follow continuous processes, the regulators can liquidate the insurance company at the instant the market value of its assets equals the market value of its liabilities, implying that the credit protection is worthless. When jumps are included in the claims process, the protection provided by the guaranty fund has a strictly positive market value. We argue that the ability to continuously monitor the equity value of a company can be a new explanation for why jump processes may be important in models of credit risk. |
| Keywords: | Credit risk for non-life insurers; guarantee fund; continuous monitoring; barrier options |
| JEL: | G13 G23 G33 |
| Date: | 2008–03–12 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:nhhfms:2008_008&r=ias |
| By: | Mercedes Ayuso (Faculty of Economics, University of Barcelona); Miguel Santolino (Faculty of Economics, University of Barcelona) |
| Abstract: | Most motor bodily injury (BI) claims are settled by negotiation, with fewer than 5% of cases going to court. A well-defined negotiation strategy is thus very useful for insurance companies. In this paper we assume that the monetary compensation awarded in court is the upper amount to be offered by the insurer in the negotiation process. Using a real database, a log-linear model is implemented to estimate the maximal offer. Non-spherical disturbances are detected. Correlation occurs when various claims are settled in the same judicial verdict. Groupwise heteroscedasticity is due to the influence of the forensic valuation on the final compensation amount. An alternative approximation based on generalized inference theory is applied to estimate confidence intervals on variance components, since classical interval estimates may be unreliable for datasets with unbalanced structures. |
| Keywords: | bodily injury claims compensation, negotiation process, generalized confidence intervals. |
| JEL: | C33 C53 G22 |
| Date: | 2008–05 |
| URL: | http://d.repec.org/n?u=RePEc:ira:wpaper:200807&r=ias |