Loss Coverage: Why Insurance Works Better with Some Adverse Selection - Softcover

Thomas, Guy

Softcover

ISBN 10: 1107495903 ISBN 13: 9781107495906

Publisher: Cambridge University Press, 2017

Synopsis

Most academic and policy commentary represents adverse selection as a severe problem in insurance, which should always be deprecated, avoided or minimised. This book gives a contrary view. It details the exaggeration of adverse selection in insurers' rhetoric and insurance economics, and presents evidence that in many insurance markets, adverse selection is weaker than most commentators suggest. A novel arithmetical argument shows that from a public policy perspective, 'weak' adverse selection can be a good thing. This is because a degree of adverse selection is needed to maximise 'loss coverage', the expected fraction of the population's losses which is compensated by insurance. This book will be valuable for those interested in public policy arguments about insurance and discrimination: academics (in economics, law and social policy), policymakers, actuaries, underwriters, disability activists, geneticists and other medical professionals.

About this title

About the Author

Guy Thomas is an actuary and investor, and an honorary lecturer at the University of Kent, Canterbury. His academic publications have received prizes from the Institute and Faculty of Actuaries and the International Actuarial Association. He is also the author of Free Capital: How Twelve Private Investors Made Millions in the Stock Market.

Edition details

• Publisher: Cambridge University Press
• Publication date: 2017
• Language: English
• ISBN 10: 1107495903
• ISBN 13: 9781107495906
• Binding: Paperback
• Number of pages: 282