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Towards a general theory of insurance production
184
Abstracts and Reviews
conclusion that the learning process is rational, the character of the learning process differs depending on the risk level. Risk-related variables are much better predictors of large risks than of small risks, which reflects the role of information costs and the benefits of learning about large risks. Keywords: Risk perception, Bayesian, Mortality, Learning. 222029 (ElO) Saving Lives in the Present Versus Saving Lives in the Future - Is there a framing Effect? Johannesson M., Johansson, Journal of Risk and Uncertainty, Volume 15, Number 2, 1997, 167-I 76. To estimate the discount rate for lives saved in the future a number of studies have been carried out on the trade-off between saving lives in the future. A telephone survey is administered to about 1700 individuals to test if the framing of the question affects the estimated trade-off. In one sample the question is framed as saving 100 lives today versus saving x future lives and in one sample the question is framed as saving 100 future lives versus saving y lives today. The results shows that the framing has a major impact on the trade-off. Keywords: Discount rate, Future health benejts, Lives saved, Framing. 222030 (ElO) Towards a General Theory of Insurance Production Eszler E., Zeitschrtft jir die Gesamte Versicherungswissenschaft, 199 7, I-36. Traditional concepts of insurance production appear to be relative insular as for instance, special historical production factors like reinsurance are integrated but recently developed risk handling instruments like insurance futures are not. This article therefore, aims at developing a general and not historically relative theory in an idealistic and axiomatic way restricted to the risk process. The product (output) of insurance production is defined of probability-distributed loss availability as compensation for the insured. This product is produced by the production factor (input) “availability of probability-distributed loss compensation resources” in its two forms as potential factor and consumable factor. When the insured event occurs tbe potential factor is transferred into the consumable factor (actual loss compensation resources) to provide the insured with actual loss compensations. The production factor as potential factor (“super factor”)
can be subdivided into “sub:factors” which can be character&d in general by the probability distribution of loss compensation resources, by the relation of sub-factor to insured probability distributions of losses, and the time of availability of actual compensation resources. Between the sub-potential factors substitutional relations may be possible. It is shown that production factors like reinsurance as well as insurance fbtures, premiums, and insurance portfolios can be integrated into this general theory of insurance production. Keywora!s: Insurance production, Insurance theory. 222031 (ElO) Insurance Broker as an Element of the Insurance Product Kromschrgder B., Zeitschrtfi fir die Gesamte Versicherungswissenschaft, 1997, 59-80. This article intents an analysis of insurance broker services. It characterises and systematically describes the output of the insurance broker firm. Furthermore, it discusses an incomplete information approach used in recent publications to explain and analyze insurance broker services. Two remarks concerning organisational and pricing aspects of the insurance broker business complete this paper. KeyworaY Insurance brokers, Pricing. 222032 (ElO) Insurance Market - Asymmetric Information and Asymmetric Regulation Wein T., Zeitschrifr fiir die Gesamte Versicherungswissenschaft, 1997, 103-130. On the one hand, many state regulations are nowadays abolished in the German insurance market. On the other hand, the competition rules have been intensified. In literature many arguments exist against successful deregulation of the insurance market (so-called “peculiarity doctrine”). Analysing the peculiarity doctrine two “market failures” are decisive asymmetric information and stochastic economies of scale, especially the law of large numbers. Many empirical researches show that the arguments in favour of stochastic economies of scale and, therefore, the existence of natural monopolies cannot be confirmed. Only in very special models does the problem of uniformed insurers lead to market failure. Market failure caused by the uninformed insured is much more likely. The author’s own empirical research shows that information problems on the demand side in the “new” German market have increased since
Abstracts and Reviews
conclusion that the learning process is rational, the character of the learning process differs depending on the risk level. Risk-related variables are much better predictors of large risks than of small risks, which reflects the role of information costs and the benefits of learning about large risks. Keywords: Risk perception, Bayesian, Mortality, Learning. 222029 (ElO) Saving Lives in the Present Versus Saving Lives in the Future - Is there a framing Effect? Johannesson M., Johansson, Journal of Risk and Uncertainty, Volume 15, Number 2, 1997, 167-I 76. To estimate the discount rate for lives saved in the future a number of studies have been carried out on the trade-off between saving lives in the future. A telephone survey is administered to about 1700 individuals to test if the framing of the question affects the estimated trade-off. In one sample the question is framed as saving 100 lives today versus saving x future lives and in one sample the question is framed as saving 100 future lives versus saving y lives today. The results shows that the framing has a major impact on the trade-off. Keywords: Discount rate, Future health benejts, Lives saved, Framing. 222030 (ElO) Towards a General Theory of Insurance Production Eszler E., Zeitschrtft jir die Gesamte Versicherungswissenschaft, 199 7, I-36. Traditional concepts of insurance production appear to be relative insular as for instance, special historical production factors like reinsurance are integrated but recently developed risk handling instruments like insurance futures are not. This article therefore, aims at developing a general and not historically relative theory in an idealistic and axiomatic way restricted to the risk process. The product (output) of insurance production is defined of probability-distributed loss availability as compensation for the insured. This product is produced by the production factor (input) “availability of probability-distributed loss compensation resources” in its two forms as potential factor and consumable factor. When the insured event occurs tbe potential factor is transferred into the consumable factor (actual loss compensation resources) to provide the insured with actual loss compensations. The production factor as potential factor (“super factor”)
can be subdivided into “sub:factors” which can be character&d in general by the probability distribution of loss compensation resources, by the relation of sub-factor to insured probability distributions of losses, and the time of availability of actual compensation resources. Between the sub-potential factors substitutional relations may be possible. It is shown that production factors like reinsurance as well as insurance fbtures, premiums, and insurance portfolios can be integrated into this general theory of insurance production. Keywora!s: Insurance production, Insurance theory. 222031 (ElO) Insurance Broker as an Element of the Insurance Product Kromschrgder B., Zeitschrtfi fir die Gesamte Versicherungswissenschaft, 1997, 59-80. This article intents an analysis of insurance broker services. It characterises and systematically describes the output of the insurance broker firm. Furthermore, it discusses an incomplete information approach used in recent publications to explain and analyze insurance broker services. Two remarks concerning organisational and pricing aspects of the insurance broker business complete this paper. KeyworaY Insurance brokers, Pricing. 222032 (ElO) Insurance Market - Asymmetric Information and Asymmetric Regulation Wein T., Zeitschrifr fiir die Gesamte Versicherungswissenschaft, 1997, 103-130. On the one hand, many state regulations are nowadays abolished in the German insurance market. On the other hand, the competition rules have been intensified. In literature many arguments exist against successful deregulation of the insurance market (so-called “peculiarity doctrine”). Analysing the peculiarity doctrine two “market failures” are decisive asymmetric information and stochastic economies of scale, especially the law of large numbers. Many empirical researches show that the arguments in favour of stochastic economies of scale and, therefore, the existence of natural monopolies cannot be confirmed. Only in very special models does the problem of uniformed insurers lead to market failure. Market failure caused by the uninformed insured is much more likely. The author’s own empirical research shows that information problems on the demand side in the “new” German market have increased since