nep-ias New Economics Papers
on Insurance Economics
Issue of 2009‒08‒02
six papers chosen by
Soumitra K Mallick
Indian Institute of Social Welfare and Bussiness Management

  1. Do self-insurance and disability insurance prevent consumption loss on disability? By Steffan G. Ball; Hamish W. Low
  2. The Impact of Private versus Social Health Insurance on Offered Waiting Times in German Acute Care Hospitals By Christoph Schwierz; Ansgar Wübker; Björn A. Kuchinke
  3. The economic insurance value of ecosystem resilience By Stefan Baumgärtner; Sebastian Strunz
  4. A Risk Management Approach for Portfolio Insurance Strategies By Benjamin Hamidi; Bertrand Maillet; Jean-Luc Prigent
  5. Livestock as insurance and social status. Evidence from reindeer herding in Norway By Anne Borge Johannesen and Anders Skonhoft
  6. The English National Health Service: An Economic Health Check By Peter Smith; Maria Goddard

  1. By: Steffan G. Ball; Hamish W. Low
    Abstract: In this paper we show the extent to which public insurance and self-insurance mitigate the cost of health shocks that limit the ability to work. We use consumption data from the UK to estimate the insurance provided by the government disability programme and account for the effectiveness of alternative self-insurance mechanisms. Individuals with a work-limiting health condition, but in receipt of disability insurance, have 7 percent lower consumption than those without such a condition. Self-insurance through savings and a working partner each provide some insurance benefit, improving outcomes from 2 percent to 4 percent. Reductions in the generosity of incapacity benefit after 1995 are associated with increases in the consumption loss associated with disability.
    Date: 2009
  2. By: Christoph Schwierz; Ansgar Wübker; Björn A. Kuchinke
    Abstract: This paper shows that patients with private health insurance (PHI) are being offered significantly shorter waiting times than patients with statutory health insurance (SHI) in German acute hospital care. This behavior may be driven by the higher expected profitability of PHI relative to SHI holders. Further,we find that hospitals offering private insurees shorter waiting times as compared to SHI holders have a significantly better financial performance than those abstaining from or with less discrimination.
    Keywords: Private health insurance, waiting time, German acute care hospitals
    JEL: I10 I11 D21
    Date: 2009–07
  3. By: Stefan Baumgärtner (Sustainability Economics Group, Department of Sustainability Sciences, Leuphana University of Lüneburg, Germany); Sebastian Strunz (Sustainability Economics Group, Department of Sustainability Sciences, Leuphana University of Lüneburg, Germany)
    Abstract: Ecosystem resilience, i.e. an ecosystem’s ability to maintain its basic functions and controls under disturbances, is often interpreted as insurance: by decreasing the probability of future drops in the provision of ecosystem services, resilience insures risk-averse ecosystem users against potential welfare losses. Using a general and stringent definition of “insurance” and a simple ecological-economic model, we derive the economic insurance value of ecosystem resilience and study how it depends on ecosystem properties, economic context, and the ecosystem user’s risk preferences. We show that (i) the insurance value of resilience is negative (positive) for low (high) levels of resilience, (ii) it increases with the level of resilience, and (iii) it is one additive component of the total economic value of resilience.
    Keywords: ecosystem, economic value, insurance, resilience, risk, risk preferences
    JEL: Q57 Q56 D81 G22
    Date: 2009–07
  4. By: Benjamin Hamidi (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I, A.A.Advisors-QCG - ABN AMRO); Bertrand Maillet (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I, A.A.Advisors-QCG - ABN AMRO, EIF - EIF); Jean-Luc Prigent (THEMA - Théorie économique, modélisation et applications - CNRS : UMR8184 - Université de Cergy Pontoise)
    Abstract: Controlling and managing potential losses is one of the main objectives of the Risk Management. Following Ben Ameur and Prigent (2007) and Chen et al. (2008), and extending the first results by Hamidi et al. (2009) when adopting a risk management approach for defining insurance portfolio strategies, we analyze and illustrate a specific dynamic portfolio insurance strategy depending on the Value-at-Risk level of the covered portfolio on the French stock market. This dynamic approach is derived from the traditional and popular portfolio insurance strategy (Cf. Black and Jones, 1987 ; Black and Perold, 1992) : the so-called "Constant Proportion Portfolio Insurance" (CPPI). However, financial results produced by this strategy crucially depend upon the leverage - called the multiple - likely guaranteeing a predetermined floor value whatever the plausible market evolutions. In other words, the unconditional multiple is defined once and for all in the traditional setting. The aim of this article is to further examine an alternative to the standard CPPI method, based on the determination of a conditional multiple. In this time-varying framework, the multiple is conditionally determined in order to remain the risk exposure constant, even if it also depends upon market conditions. Furthermore, we propose to define the multiple as a function of an extended Dynamic AutoRegressive Quantile model of the Value-at-Risk (DARQ-VaR). Using a French daily stock database (CAC 40) and individual stocks in the period 1998-2008), we present the main performance and risk results of the proposed Dynamic Proportion Portfolio Insurance strategy, first on real market data and secondly on artificial bootstrapped and surrogate data. Our main conclusion strengthens the previous ones : the conditional Dynamic Strategy with Constant-risk exposure dominates most of the time the traditional Constant-asset exposure unconditional strategies.
    Keywords: CPPI, Portfolio insurance, VaR, CAViaR, quantile regression, dynamic quantile model.
    Date: 2009–05
  5. By: Anne Borge Johannesen and Anders Skonhoft (Department of Economics, Norwegian University of Science and Technology)
    Abstract: The theory of livestock as a buffer stock predicts that agropastoralists facing substantial risks typically will use liquid assets, such as livestock, for self-insurance to smooth consumption. This paper examines this hypothesis for reindeer herders in Norway where the herders, in contrast to pastoralists in, say, Sub-Saharan Africa, face well functioning credit markets. Using survey data including slaughtering responses to a hypothetical meat price increase, we test whether keeping reindeer as insurance against risks affects the slaughter response. Furthermore, we study whether status motives for keeping large herds affect the harvest response to a changing slaughter price. As a background for the empirical analysis, a stochastic bioeconomic model describing Saami reindeer herding is formulated
    Date: 2009–07–10
  6. By: Peter Smith; Maria Goddard
    Abstract: The government’s health reform programme since 2000 has covered many aspects of the organisation of health care and was accompanied by a sizeable increase in spending on healthcare. Many of these reforms have the potential to improve the efficiency and responsiveness of the health care system and ultimately health outcomes, although it is too early to make definitive judgements on their effectiveness. This chapter provides an overview of the organisation and financing of the National Health Service, reviews its performance, assesses the reforms since the start of the decade and provides recommendations for further development. This Working Paper relates to the 2009 Economic Survey of the United Kingdom (<P>Système national de santé anglais : Bilan de santé économique<BR>Le programme de réformes engagé par le gouvernement depuis 2000 dans le secteur de la santé couvre de nombreux aspects de l’organisation des soins et services de santé et il s’est accompagné d’une augmentation notable des dépenses consacrées à la santé. Nombre de ces réformes sont de nature à améliorer l’efficience et la réactivité du système de santé et, en fin de compte, les résultats sur le plan de la santé, bien qu'il soit trop tôt pour porter des jugements définitifs sur leur efficacité. Ce chapitre donne une vue d’ensemble de l’organisation et du financement du National Health Service ; il en examine les performances et évalue les réformes conduites depuis le début de la décennie, et formule des recommandations pour la poursuite des réformes. Ce document de travail se rapporte à l'Étude économique de l'OCDE de le Royaume-Uni 2009 (
    Keywords: health care reforms, résultats de la santé, health expenditure, dépenses de santé, English health care system, système de soins de santé anglais, health outcomes, réforme du système de soins de santé
    JEL: H51 I12 O57
    Date: 2009–07–22

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