Theoretical Foundations of Community Rating by a Private Monopolist Insurer: Framework, Regulation, and Numerical Analysis - Archive ouverte HAL Accéder directement au contenu
Pré-Publication, Document De Travail Année : 2023

Theoretical Foundations of Community Rating by a Private Monopolist Insurer: Framework, Regulation, and Numerical Analysis

Résumé

Community rating is a policy that mandates uniform premium regardless of the risk factors. In this paper, our focus narrows to the single contract interpretation wherein we establish a theoretical framework for community rating using Stiglitz's (1977) monopoly model in which there is a continuum of agents. We exhibit profitability conditions and show that, under mild regularity conditions, the optimal premium is unique and satisfies the inverse elasticity rule. Our numerical analysis, using realistic parameter values, reveals that under regulation, a 10% increase in indemnity is possible with minimal impact on other variables.
Fichier principal
Vignette du fichier
2309.15269.pdf (24.73 Mo) Télécharger le fichier
Origine : Fichiers produits par l'(les) auteur(s)

Dates et versions

hal-04373063 , version 1 (04-01-2024)

Identifiants

Citer

Yann Braouezec, John Cagnol. Theoretical Foundations of Community Rating by a Private Monopolist Insurer: Framework, Regulation, and Numerical Analysis. 2024. ⟨hal-04373063⟩
26 Consultations
3 Téléchargements

Altmetric

Partager

Gmail Facebook X LinkedIn More