THE OPTIMAL CO-INSURANCE MODEL
Co-insurance is a concept defined by several people as simultaneously insurance in the amount deposited in advance warranty. In the present article we shall consider a risk averse agent with an initial wealth that supports a risk of loss. Supposing that for every euro paid as damages by the insura...
| Main Authors: | , , |
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| Format: | Article |
| Language: | English |
| Published: |
Academica Brâncuşi
2015-12-01
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| Series: | Analele Universităţii Constantin Brâncuşi din Târgu Jiu : Seria Economie |
| Subjects: | |
| Online Access: | http://www.utgjiu.ro/revista/ec/pdf/2015-Special%20ECOTREND/50_Anghelache,%20Anghel,%20Ursache.pdf |
| Summary: | Co-insurance is a concept defined by several people as simultaneously insurance in the amount deposited in
advance warranty. In the present article we shall consider a risk averse agent with an initial wealth that supports a risk
of loss. Supposing that for every euro paid as damages by the insurance policy, the insurer incurrs a one-off
transaction costs. Obviously, more complex structures are also possible cost. If we add these transaction costs to the
expected costs of damage in the first plan insurance payments must be equal. Level λ is often considered as an
influential factor or source of profit and loss. So, if spending rises to 10 lei for every 100 lei of the damage, the insurer
will add 10% to competitive actuarial value of an insurance policy in order to cover these expenses. |
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| ISSN: | 1844-7007 1844-7007 |