New Perspectives on Insurance

Abstract

This special issue originates from a dual submission conference with the NBER Insurance Working Group and the Corporate Finance Program in 2020. It brings a broader perspective on important frictions in insurance markets, including trust between insurers and policyholders, conflicts of interest among brokers, suboptimal policyholder behavior, and risk-based capital regulation. Several developments in the economy and the academic literature have provided an impetus for new perspectives, including the growth of savings products with minimum return guarantees, the global financial crisis, and intermediary asset pricing. We conclude with an overview of research questions that are promising for further exploration.

Insurance and portfolio decisions: Two sides of the same coin?

“…Gennaioli et al 2022, Egan, Ge andTang 2022). Nevertheless, as noted by Gomes et al (2021) and Koijen and Yogo (2022), the drivers of households' insurance decisions are still largely unknown. More generally, little is known about the way households combine portfolio and insurance decisions to manage their risk exposure.…”