Don't They Care? Or, Are They Just Unaware? Risk Perception and the Demand for Long-Term Care Insurance

Zhou-Richter, Tian; Browne, Mark J.; Gründl, Helmut

doi:10.1111/j.1539-6975.2010.01362.x

Cited by 82 publications

(55 citation statements)

References 31 publications

Supporting

Mentioning

Contrasting

Unclassified

Order By: Relevance

“…Empirical surveys confirm such a possibility. Indeed, Zhou-Richter et al (2010) showed that in Germany adult children would be willing to purchase LTC insurance for their parents. For the U.S., Cohen et al (2000) indicated that primary informal caregivers purchased LTC insurance policy themselves for their elderly relatives.…”

Section: Premium Paid By the Childmentioning

confidence: 98%

“…In that respect, Zhou-Richter et al (2010) recently investigated empirically the role of adult children in the demand for LTC insurance. They showed that the more aware adult children are of LTC risk, the more likely LTC insurance is purchased, either by the adult children themselves on behalf of their parents or by the parents under the influence of their adult children.…”

Section: Introductionmentioning

confidence: 99%

See 1 more Smart Citation

On insuring and caring for parents’ long-term care needs

Courbage

Eeckhoudt²

2012

Journal of Health Economics

View full text Add to dashboard Cite

Section: Premium Paid By the Childmentioning

confidence: 98%

Section: Introductionmentioning

confidence: 99%

On insuring and caring for parents’ long-term care needs

Courbage

Eeckhoudt²

2012

Journal of Health Economics

View full text Add to dashboard Cite

“…Consequently, the interpretation of (22) is similar to that of (25) except that the signs of the two effects are reversed.…”

Section: Optimal Policy: Problem and First-order Conditionsmentioning

confidence: 85%

Social insurance with competitive insurance markets and risk misperception

Cremer

Roeder

2017

Journal of Public Economics

View full text Add to dashboard Cite

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Rochet (1991) has shown that when private insurance markets offer full coverage at fair rates, social insurance is desirable if and only if risk and productivity are negatively correlated. This condition is usually shown to be satisfied for many health risks, but it appears to be violated for the old age dependency risk (mainly because longevity in turn is positively correlated with productivity). We examine the role of uniform and nonuniform social insurance to supplement a general income tax when neither public nor private insurers can observe individual risk and when it is positively correlated with wages. Consequently, a Rothschild and Stiglitz (1971) equilibrium emerges in the private insurance market and low-wage/low-risk individuals are not fully insured. We show that even when social insurance provided to the poor has a negative incentive effect, it also increases their otherwise insufficient insurance coverage. Social insurance to the rich produces exactly the opposite effects. Whichever of these effects dominates, some social insurance is always desirable. Finally, we introduce risk misperception which exacerbates the failure of private markets. The insurance term now reflects the combined failure brought about by adverse selection and misperception. Now the low-risk individuals are not only underinsured, but also pay a higher than fair rate. However, and rather surprisingly, it turns out that this does not necessarily strengthen the case for public insurance. Terms of use: Documents in D I S C U S S I O N P A P E R S E R I E S Social Insurance with Competitive Insurance Markets and Risk MisperceptionJEL Classification: H21, H51, D82

show abstract

“…Our approach is compatible with similar studies such as Ferna´ndez and Forder (2010) for the U.K. 13 See, for example, Jagger et al (2006). 14 See Pauly (1990) and Zhou-Richter et al (2010).…”

Section: Risk Mitigation Of a Protection For Ltc Lifetime Individual mentioning

confidence: 98%

How Much Risk Is Mitigated by LTC Protection Schemes? A Methodological Note and a Case Study of the Public System in Spain

Guillén

Comas-Herrera

2012

Geneva Pap Risk Insur Issues Pract

View full text Add to dashboard Cite

We present a methodology to measure the risk of incurring extremely large individual lifetime costs of long-term care (LTC). We show a method that can be used to compare the risk reductions achieved by alternative LTC protection plans. Our proposed methodology is illustrated with a case study. Our estimates show that, according to our proposed risk measure, the Spanish public LTC system mitigates individual risk by more than 30 per cent compared to the situation where no public protection is available. However, the Spanish public LTC system still leaves individuals facing very high lifetime costs of care. We estimate that there is a risk of about 1 per cent that a man will have to spend more than h211,800 and a risk of about 1 per cent that a woman will have to spend about h232,600 to cover lifetime LTC costs. Despite the current public Spanish LTC coverage, risk mitigation may still be too low since catastrophic costs of care persist and, therefore, we suggest that private insurance should be encouraged.

show abstract

Don't They Care? Or, Are They Just Unaware? Risk Perception and the Demand for Long-Term Care Insurance

Cited by 82 publications

References 31 publications

On insuring and caring for parents’ long-term care needs

On insuring and caring for parents’ long-term care needs

Social insurance with competitive insurance markets and risk misperception

How Much Risk Is Mitigated by LTC Protection Schemes? A Methodological Note and a Case Study of the Public System in Spain

Contact Info

Product

Resources

About