Quotation Doherty, Neil, Laux, Christian, Mürmann, Alexander. 2015. Insuring Nonverifiable Losses. Review of Finance 19 (1): S. 283-316.




Insurance contracts are often complex and difficult to verify outside the insurance relation. We show that standard one-period insurance policies with an upper limit and a deductible are the optimal incentive-compatible contracts in a competitive market with repeated interaction. Optimal group insurance policies involve a joint upper limit and individual deductibles; insurance brokers can play a role implementing such contracts for their clients. Our model provides new insights and predictions about the determinants of insurance.


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Publication's profile

Status of publication Published
Affiliation WU
Type of publication Journal article
Journal Review of Finance
Citation Index SSCI
WU Journalrating 2009 A
WU-Journal-Rating new FIN-A, STRAT-A, VW-A, WH-A
Language English
Title Insuring Nonverifiable Losses
Volume 19
Number 1
Year 2015
Page from 283
Page to 316
URL http://rof.oxfordjournals.org/content/19/1/283.abstract
DOI http://dx.doi.org/10.1093/rof/rft056


PhD Programm: Vienna Graduate School of Finance
Laux, Christian (Details)
Mürmann, Alexander (Details)
Doherty, Neil
Institute for Finance, Banking and Insurance IN (Details)
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