Economic efficiency and mixed public/private insurance

Article Abstract:

The productiveness of an insurance market is reduced in situations where supplementary private insurance and a compulsory government insurance plan co-exist. Such insurance market is less effective compared to a market that is entirely dominated by a supplementary private insurance. It is also less productive when compared to a market that is monopolized by a government plan. A mixed insurance market only becomes effective in few selected situations, such as the existence of expensive administrative and marketing costs in private insurance.

Insurance Agencies and Brokerages, Insurance agents, brokers, & service, Insurance Agents & Brokers

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Strategic risk taking when there is a public good to be provided privately

Article Abstract:

A case was presented in which a riskier situation is preferred by a risk averse agent. The player, whose risk aversion is small, refuses to purchase any insurance and prefers to engage in some risky activity. The case shows that the player with greater uncertainty can expect an earning transfer from other individuals when a public good is to be provided privately after the insurance decision. It is also shown that risk-taking incentives tend to be affected by voluntary contributions game participation.

Risk (Insurance)

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More on the economic efficiency of mixed public/private insurance

Article Abstract:

Arguments raised by Blomqvist and Johansson supporting the claim of Besley regarding the attractiveness of a mixed insurance market remain unsubstantiated. The two argued that utilization of a more general model could have yielded results that can validate the conjecture of Beasley. Blomqvist and Johansson's finding showing the significance of public catastrophic coverage on insurance market can only be implemented in an example they have utilized and not on other situations.

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