Optimal Insurance Arrangements

Abstract
In a recent paper on the theory of demand for insurance Arrow [I] has proved that the optimal policy for an insurance buyer is one which gives complete coverage, beyond a fixed deductible. The result is proved under very general assumptions, but its content can be illustrated by the following simple example.
Volume
8:3
Page
284-290
Year
1975
Categories
Financial and Statistical Methods
Risk Pricing and Risk Evaluation Models
Business Areas
Publications
ASTIN Bulletin
Authors
Karl H Borch