Abstract
This chapter extends the previous results in regard to demand, granting the insured the ability to reduce the loss magnitude via self-insurance efforts. In general, it is established that self-insurance and index insurance are substitutes, with the level of efforts undertaken being extended in comparison to a situation with a classic insurance being offered. The effect is two fold; on the one hand, efforts are increased because coverage under an index based insurance is smaller than under a classic insurance while further, basic chance and basic risk promote some additional undertaking of efforts.
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© 2019 Springer Fachmedien Wiesbaden GmbH, part of Springer Nature
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Rödl, M. (2019). Self-insurance. In: Contributions to the Economics of Index Based Insurance Schemes. Management, Organisation und ökonomische Analyse. Springer Gabler, Wiesbaden. https://doi.org/10.1007/978-3-658-25248-9_4
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DOI: https://doi.org/10.1007/978-3-658-25248-9_4
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Publisher Name: Springer Gabler, Wiesbaden
Print ISBN: 978-3-658-25247-2
Online ISBN: 978-3-658-25248-9
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