THE ANALYSIS OF THE COMPREHENSIVE INSURANCE DEMAND FOR TURKEY USING UTILITY THEORY AND SYSTEM SIMULATION | Zendy

Murat Kırkağaç | Zendy; Övgücan Karadağ Erdemir | Zendy; Yasemin Gençtürk | Zendy

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THE ANALYSIS OF THE COMPREHENSIVE INSURANCE DEMAND FOR TURKEY USING UTILITY THEORY AND SYSTEM SIMULATION

Author(s) -

Murat Kırkağaç,

Övgücan Karadağ Erdemir,

Yasemin Gençtürk

Publication year - 2017

Publication title -

anadolu university journal of science and technology-a applied sciences and engineering

Language(s) - English

Resource type - Journals

ISSN - 1302-3160

DOI - 10.18038/aubtda.300425

Subject(s) - turkish , insurance premium , actuarial science , economics , utility theory , auto insurance risk selection , on demand , key person insurance , expected utility hypothesis , econometrics , insurance policy , financial economics , mathematical economics , philosophy , linguistics , commerce

In this study, the demand for comprehensive insurance is analysed using utility theory and system simulation. A simulation study is performed to assess the behaviour of individuals with different income levels for the demand of comprehensive insurance. Simulation assumptions and input-output variables are determined using the real data set from a Turkish insurance company and the report about the insurance activities in Turkey for year 2014. The effects of income level, expected claim severity and premium level on the demand for insurance are investigated. It is concluded that while an increase in income level and expected claim severity causes an increase in the demand, an increase in premium level causes a decrease in the demand.

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