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on Insurance Economics |
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Issue of 2014‒11‒17
ten papers chosen by Soumitra K. Mallick Indian Institute of Social Welfare and Business Management |
| By: | Asian Development Bank (ADB); (East Asia Department, ADB); ; |
| Abstract: | Mongolia experienced a challenging transition from socialist economy to market economy from 1990 onwards. Its commercial insurance market is still at its infancy, with gross written premiums in 2013 amounting to only 0.54% of gross domestic production. ADB undertook this technical assistance study to support microinsurance development in Mongolia. The study provides an overview of the development of Mongolia’s insurance market in general and the microinsurance segment in particular, then identifies gaps in the insurance regulatory framework that need to be bridged to expand microinsurance coverage to more households. |
| Keywords: | adb, asian development bank, asdb, asia, pacific, poverty asia, mongolia, microinsurance, mongolia insurance, mongolia insurance, mongolia finance, mongolia finance, gross written premium, gross written premium, livestock insurance, livestock insurance, savings and credit cooperative, savings and credit cooperative, nonbanking financial institutions, nonbanking financial institutions, microfinance, responsible finance, finance |
| Date: | 2014–05 |
| URL: | http://d.repec.org/n?u=RePEc:asd:wpaper:rpt135950-2&r=ias |
| By: | Adu, Kofi Osei |
| Abstract: | This study investigated the reasons for low participation in national health insurance scheme and health seeking behaviour of both insured and uninsured in central Twifo hemang Lower Denkyira district in Central Region of Ghana. Data were collected from both household heads who are enrolled in NHIS and those who have not been enrolled in the district for the purpose of analysis. The researcher employed interview schedule as data collection instrument used for the collection of the data from the respondents. In total, 400 household heads were interviewed. The study found that the major barrier to national health insurance scheme enrollment is affordability of the premiums. If the annual premium is paid in a lump sum, household heads find it more difficult to pay. Therefore this study recommends that national health insurance scheme annul premium could be paid on installment basis rather than lump sum. Thus the payment of annual premium could be spread out over the year. Also, government should strengthen policies to enhance income level. |
| Keywords: | national health insurance, household heads, premium |
| JEL: | I13 |
| Date: | 2014–09–10 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:58411&r=ias |
| By: | Marcus C. Christiansen (University of Ulm, Germany); Michel M. Denuit (Universit� Catholique de Louvain, Belgium); Jan Dhaene (Katholieke Universiteit Leuven, Belgium, and University of the Free State, South Africa) |
| Abstract: | Premiums and benefits associated with traditional life insurance contracts are usually specified as fixed amounts in policy conditions. However, reserve-dependent surrender values and reserve-dependent expenses are common in insurance practice. The famous Cantelli theorem in life insurance ensures that under appropriate assumptions surrendering can be ignored in reserve calculations provided the surrender payment equals the accumulated reserve. In this paper, more complex reserve-dependent payment patterns are considered, in line with insurance practice. Explicit formulas are derived for the corresponding reserve. |
| Keywords: | life insurance, multistate models, Markov process, surrender value, Cantelli theorem |
| Date: | 2014–08–29 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:uvatin:20140117&r=ias |
| By: | Helge Braun; Björn Brügemann |
| Abstract: | We study welfare effects of public short-time compensation (STC) in a model in which firms respond to idiosyncratic profitability shocks by adjusting employment and hours per worker. Introducing STC substantially improves welfare by mitigating distortions caused by public UI, but only if firms have access to private insurance. Otherwise firms respond to low proprofitability by combining layoffs with long hours for remaining workers, rather than by taking up STC. Optimal STC is substantially less generous than UI even when firms have access to private insurance, and equally generous STC is worse than not offering STC at all. |
| Keywords: | Short-Time Compensation, Unemployment Insurance, Welfare |
| JEL: | J65 |
| Date: | 2014–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:kls:series:0077&r=ias |
| By: | Johannes Emmerling (Fondazione Eni Enrico Mattei) |
| Abstract: | Uncertainty is prevalent in the context of climate change impacts. Moreover, the distribution across the globe is not uniform. We analyze how climate risks could be reduced via an insurance scheme at the global scale across regions and quantify the potential welfare gains from such a scheme. Starting from the standard welfare analysis in Integrated Assessment Models (IAMs), which assumes no risk sharing across region, we introduce global risk sharing via a market for state-dependent Arrow-Debreu securities. We show that this allows equalizing relative consumption differences between states of the world across regions. We estimate that such risk sharing scheme of climate risks could lead to welfare gains reducing the global costs of climate change by up to one third, while the amount of transfers required is substantial. This provides arguments for considering risk sharing in IAMs, but also for potentially welfare increasing negotiations about sharing risks of climate change at the global level. |
| Keywords: | Uncertainty, Risk Sharing, Insurance, Climate Change, Risk Aversion |
| JEL: | Q54 D81 D63 |
| Date: | 2014–09 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2014.78&r=ias |
| By: | Johansson, Per (IFAU - Institute for Evaluation of Labour Market and Education Policy); Laun, Lisa (IFAU - Institute for Evaluation of Labour Market and Education Policy); Palme, Mårten (Department of Economics, Stockholm University) |
| Abstract: | We study how economic incentives affect labor force exit through different income security programs, old-age pensions as well as income taxes in Sweden. We use the option value for staying in the labor force as a measure of economic incentives and estimate an econometric model for the choice of leaving the labor market. Besides old-age pension, we focus on the Disability Insurance (DI), which is the most important exit path before age 65. By simulating the effect of different probabilities to be admitted DI we show how changes in the stringency of DI admittance affects labor supply among older workers through economic incentives. |
| Keywords: | Disability Insurance; option value; labor market exit; labor supply |
| JEL: | H55 J14 J26 |
| Date: | 2014–08–25 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ifauwp:2014_020&r=ias |
| By: | Halim Zeghdoudi; Meriem Bouhadjar; Mohamed Riad Remita |
| Abstract: | This paper focuses on stochastic orders and its applications : policy limits and deductibles. Further, many applications and some examples are given : comparison of two families of copulas, individual and collective risk model, reinsurance contracts and dependent portfolios increase risk. More precisely, we propose a new model for insurance risks while we give some properties. To this end, we obtain the ordering of the optimal allocation of policy limits and deductibles for this model. |
| Date: | 2014–11 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:1411.1609&r=ias |
| By: | Cody B. Hyndman; Menachem Wenger |
| Abstract: | We construct a binomial model for a guaranteed minimum withdrawal benefit (GMWB) rider to a variable annuity (VA) under optimal policyholder behaviour. The binomial model results in explicitly formulated perfect hedging strategies funded using only periodic fee income. We consider the separate perspectives of the insurer and policyholder and introduce a unifying relationship. Decompositions of the VA and GMWB contract into term-certain payments and options representing the guarantee and early surrender features similar to those presented in Hyndman and Wenger (Insurance Math. Econom. 55:283-290, 2014) are extended to the binomial framework. We incorporate an approximation algorithm for Asian options that significantly improves efficiency of the binomial model while retaining accuracy. Several numerical examples are provided which illustrate both the accuracy and the tractability of the model. |
| Date: | 2014–10 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:1410.7453&r=ias |
| By: | Matthieu BOUSSICHAS (Ferdi); Vincent NOSSEK (Ferdi) |
| Abstract: | Ce document propose une comparaison statistique des objectifs du développement durable (ODD) et de leurs principales cibles dans les PMA, les autres pays vulnérables et les autres pays en développement. Il se base sur les ODD proposés le 19 juillet 2014 par le Groupe de travail ouvert de l’Assemblée générale des Nations Unies sur les objectifs de développement durable. Alors que le nouvel agenda post-2015 sera universel, la grande hétérogénéité des pays pose la question de la différenciation de l’agenda en fonction des spécificités, notamment celles des pays vulnérables. Un élément de réponse tient dans l’identification de ces spécificités pour les objectifs et cibles proposés. Ce document compare ainsi les Pays les Moins Avancés (PMA), les Pays en Développement Sans Littoral (PDSL) et les Petits Etats Insulaires en Développement (PEID) aux pays en développement hors-PMA ou aux pays à revenu intermédiaires (PRI) selon la disponibilité des données. Ce travail s’inscrit dans la continuité du document de travail P77 de la Ferdi (Boussichas, Coudert, & Gillot, 2013) qui établit un bilan factuel par OMD (objectifs du Millénaire pour le développement) pour les pays vulnérables et compare les résultats obtenus par chaque catégorie à ceux des pays en développement hors-PMA. A l’instar de ce que le bilan des OMD permet d’observer, il apparaît que, globalement, les pays vulnérables et en particulier les PMA se distinguent par un retard significatif sur la majorité des nouveaux objectifs et cibles de l’agenda post-2015. La crainte qu’un élargissement de l’agenda du développement au développement durable ne dilue à l’avenir la priorité donnée jusqu’à maintenant à ces pays ne peut être alimentée par les statistiques tant les besoins des pays vulnérables en matière de développement durable apparaissent globalement plus importants que ceux des autres catégories de pays. Afin de prendre en compte les niveaux initiaux des pays dans l’évaluation des progrès, ce travail introduit, lorsque cela est possible et pertinent, une évaluation non linéaire des progrès constatés depuis 2000 sur les possibles futurs objectifs. Ainsi, bien que leurs niveaux d’éducation et de santé restent plus faibles, la performance des PMA dans ces deux secteurs s’avère relativement meilleure que celle des autres PED. Le même constat peut être fait pour l’utilisation d’énergies alternatives et renouvelables. En revanche, les progrès des PMA sont décevants en matière de lutte contre la pauvreté et la malnutrition au regard de ce qu’a été la performance des autres PED. Ces résultats montrent deux choses : 1/ L’approche OMD a probablement permis aux PMA de rattraper en partie (mais en partie seulement) leur retard en matière de capital humain. Ce constat encourageant milite pour une différenciation renouvelée à leur égard, notamment dans les efforts spécifiques de la communauté internationale dont ils bénéficient ; 2/ Les PMA se distinguant cependant par une mauvaise performance en matière de pauvreté et de malnutrition, il est important de considérer spécifiquement ces pays sur l’ensemble des facteurs concourant à cette mauvaise performance. Nombre de ces facteurs sont précisément parmi ceux nouvellement pris en compte dans l’agenda post-2015. Or, les PMA accusent un retard significatif pour la plupart de ces facteurs. Afin de rééditer pour les autres facteurs du développement la relative bonne performance des PMA en matière de capital humain, les pays vulnérables doivent continuer à bénéficier d’un support particulier de la communauté internationale. |
| JEL: | F35 I32 I38 O11 E61 |
| Date: | 2014–10 |
| URL: | http://d.repec.org/n?u=RePEc:fdi:wpaper:1832&r=ias |
| By: | Alice Sanwald; Thomas Schober |
| Abstract: | We analyze mortality and follow-up costs of heart attack patients using administrative data from Austria from 2002-2011. As treatment intensity in a hospital largely depends on whether it has a catheterization laboratory, we focus on the effects of patients' initial admission to these specialized hospitals. To account for the nonrandom selection of patients into hospitals, we exploit individuals' place of residence as a source of exogenous variation in an instrumental variable framework. We find that the initial admission to specialized hospitals increases patients' survival chances substantially. The effect on 3-year mortality is -9.5 percentage points. A separation of the sample into subgroups shows the strongest effects in relative terms for patients below the age of 65. We do not find significant effects on long-term inpatient costs and find only marginal increases in outpatient costs. |
| Keywords: | Acute myocardial infarction, mortality, costs, instrumental variables |
| JEL: | I11 I12 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:inn:wpaper:2014-26&r=ias |