Near-losses in insurance markets: An experiment

Heinrich, T; Seifert, M; Then, F

Abstract

Several studies report changes in risk attitudes following losses that have been nearly averted. We disentangle strategic and non-strategic reactions to such near-loss events experimentally. We ob-serve that near-losses affect the demand for insurance under strategic uncertainty: the bids and asks for insurances increase in a call market after subjects experience near-losses, while individu-al evaluations of insurances are unaffected.

Citation

Heinrich, T., Seifert, M., & Then, F. (2020). Near-losses in insurance markets: An experiment. Economics Letters, 186, Article 108781. https://doi.org/10.1016/j.econlet.2019.108781

• Journal Article Type: Article
• Acceptance Date: Oct 20, 2019
• Online Publication Date: Oct 31, 2019
• Publication Date: Jan 31, 2020
• Deposit Date: Sep 3, 2019
• Publicly Available Date: Apr 30, 2021
• Journal: Economics Letters
• Print ISSN: 0165-1765
• Electronic ISSN: 1873-7374
• Publisher: Elsevier
• Peer Reviewed: Peer Reviewed
• Volume: 186
• Article Number: 108781
• DOI: https://doi.org/10.1016/j.econlet.2019.108781
• Public URL: https://durham-repository.worktribe.com/output/1294259