Willingness to Pay for Insurance in Denmark

Jan V. Hansen, Rasmus Højbjerg Jacobsen, Morten Lau

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Abstrakt

We estimate how much Danish households are willing to pay for auto, home, and house insurance. We use a unique combination of claims data from a large Danish insurance company, measures of individual risk attitudes and discount rates from a field experiment with a representative sample of the adult Danish population, and information on household income and wealth from registers at Statistics Denmark. The results show that the willingness to pay is marginally higher than the actuarially fair value under expected utility theory, but significantly higher under rank-dependent utility theory, and up to 600 percent higher than the actuarially fair value.
OriginalsprogEngelsk
TidsskriftJournal of Risk and Insurance
Vol/bind83
Udgave nummer1
Sider (fra-til)49-76
Antal sider28
ISSN0022-4367
DOI
StatusUdgivet - mar. 2016

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