Zur bedeutung einer Ausfallbedrohtheit von Versicherungskontrakten — ein Beitrag zur Behavioral Insurance

Abstract

Die Autoren erlauben sich, den vorliegenden Beitrag Elmar Helten zu widmen, der bereits sehr 1) frühzeitig die Vision einer verhaltenswissenschaftlich geprägten Analyse von Versicherungsentscheidungen postuliert hat und damit als geistiger Vater eines Behavioral Insurance-Ansatzes angesehen werden kann. Relevante Entwicklungen der Versicherungswissenschaft und -praxis frühzeitig zu erkennen ist eine der charakteristischen Gaben von Elmar Helten, diese Entwicklungen zu fördern sein Verdienst.Die Autoren danken einem anonymen Gutachter, der mit seinen Anregungen zu einer wesentlichen Verbesserung der vorliegenden Arbeit beigetragen hat, sowie für die Unterstützung seitens der Deutschen Forschungsgemeinschaft, SFB 504 der Universität Mannheim. SummaryKahneman/Tversky 1979 introduced the notion of so-called probabilistic insurance contracts. These are insurance policies involving a small probability that the consumer is not reimbursed because of a possible default of the insurance company. Extending the study of Wakker/Thaler/Tversky 1997, the present study contains an experimental analysis of the willingness of potential policyholders to pay for probabilistic insurance in dependency on the rating of the insurance company. It can be shown that people dislike probabilistic insurance and demand a substantial reduction in the premium to compensate for default risk. This reduction is rising with the default risk of the company. In addition, the results show a new phenomenon. The more an insurance company is threatened by default risk the less people are willing to accept contracts of this company at all. Finally the paper discusses implications for the control of insurance companies.

Is There Market Discipline in the European Insurance Industry? An Analysis of the German Insurance Market

“…For example, Wakker et al (1997) show the risk sensitivity of policy holders in that an increase in default risk severely affects policy holder willingness to pay. Similar evidence could be given by Albrecht and Maurer (2000), Zimmer et al (2009a, b). 20 See Sommer (1996); Phillips et al (1998).…”

Is default risk acceptable when purchasing insurance? Experimental evidence for different probability representations, reasons for default, and framings

“…Further, choosing household insurance allows us to add new experimental evidence on the subject of insurance with default risk as it is a different type of property-liability insurance than that looked at in other studies. Wakker et al (1997) studied willingness to pay for probabilistic private fire insurance and Albrecht and Maurer (2000) studied probabilistic automobile liability insurance. 5 In this experiment, we were solely interested in differences in willingness to pay for specific household insurance contracts with different default probabilities.…”

“…Similar results are reported 0167-4870/$ -see front matter Ó 2008 Elsevier B.V. All rights reserved. doi:10.1016/j.joep.2008.09.001 by Albrecht and Maurer (2000), who, in addition, find that the greater the insurer's default risk, the more people will refuse to pay anything at all for such an insurance policy. This paper tests the robustness of these findings.…”

“…However, when deciding to purchase insurance, consumers must keep in mind (or should) that the insurance contract itself might be exposed to the risk of default, i.e., the insurance policy might involve a small probability that the policyholder will not be reimbursed partially or totally by the insurer in case of a loss. Experimental research by Wakker et al (1997) and Albrecht and Maurer (2000) shows that the awareness of default risk has an influence on consumers' insurance purchase behavior. People dislike insurance contracts that might default when indemnity payments are needed.…”

Investment guarantees in unit-linked life insurance from the customer perspective

“…Using prospect theory, Wakker et al (1997) explain experimental data on the demand for probabilistic insurance policies, which accounts for the insolvency risk of an insurer by indemnifying the policyholder with a probability of strictly less than 1. Further experimental research on insurance demand under default risk was conducted by Albrecht and Maurer (2000), Zimmer et 1 The mental models believed to be in play during insurance purchase decisions include the following: anchoring, i.e., the adjustment on an initial value (Tversky and Kahneman 1974); an availability bias, i.e., the evaluation depends on how easily something comes to mind (Tversky and Kahneman 1973); a certainty effect, i.e., the overweighting of certain outcomes relative to probable outcomes (Allais 1953;Tversky and Wakker 1995); framing, i.e., reliance on how information is presented Kahneman 1981, 1986;Kahneman and Tversky 1984); loss aversion, i.e., losses loom larger than corresponding gains (Tversky and Kahneman 1991); mental accounting, i.e., the dividing of current and future assets into separate, nontransferable portions (Thaler 1999); wishful thinking, and overconfidence, e.g., by overestimating own knowledge and ability to control events, while underestimating risks (Barberis and Thaler 2005); risk perception (Slovic 1972;Slovic et al 1977) or an overestimation of probabilities (Johnson et al 1993). (Kahneman and Tversky 1979) al.…”