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Fixed‐Reimbursement Insurance: Basic Properties and Comparative Statics
Author(s) -
Eeckhoudt Louis,
Mahul Olivier,
Moran John
Publication year - 2003
Publication title -
journal of risk and insurance
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.055
H-Index - 63
eISSN - 1539-6975
pISSN - 0022-4367
DOI - 10.1111/1539-6975.00056
Subject(s) - comparative statics , reimbursement , actuarial science , event (particle physics) , insurance policy , economics , business , microeconomics , health care , physics , quantum mechanics , economic growth
In a number of settings, insurance contracts specify a fixed reimbursement in the event of a loss which is not conditioned on the size of the realized loss. In this article, we explore the theoretical properties of this form of insurance and draw comparisons with other types of insurance policies, such as those based on coinsurance and deductibles. We also examine links between our results and those from the literature on precautionary saving.
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