Asymmetric Information in the Market for Automobile Insurance: Evidence from Germany.

Spindler, Martin; Winter, Joachim und Hagmayer, Steffen (2014): Asymmetric Information in the Market for Automobile Insurance: Evidence from Germany. In: Journal of Risk and Insurance, Bd. 81, Nr. 4: 781 - 801

Abstract

Asymmetric information is an important phenomenon in insurance markets, but the empirical evidence on the extent of adverse selection and moral hazard is mixed. Because of its implications for pricing, contract design, and regulation, it is crucial to test for asymmetric information in specific insurance markets. In this article, we analyze a recent data set on automobile insurance in Germany, the largest such market in Europe. We present and compare a variety of statistical testing procedures. We find that the extent of asymmetric information depends on coverage levels and on the specific risks covered, which enhances the previous literature. Within the framework of Chiappori et al. (2006), we also test whether drivers have realistic expectations concerning their loss distribution, and we analyze the market structure.

• Dokumententyp: Zeitschriftenartikel
• Keywords: Asymmetric and Private Information; Mechanism Design D82, Insurance; Insurance Companies; Actuarial Studies G22, Transportation: Demand, Supply, and Congestion; Travel Time; Safety and Accidents; Transportation Noise R41
• Fakultät: Volkswirtschaft > Lehrstühle > Seminar für empirische Wirtschaftsforschung
• Themengebiete: 300 Sozialwissenschaften > 330 Wirtschaft
• ISSN: 00224367
• Sprache: Englisch