Dynamic inefficiencies in insurance markets
Subtitle: evidence from long-term care insurance
By: Amy Finkelstein, Kathleen McGarry, Amir Sufi.
Contributors: McGarry, Kathleen.; Sufi, Amir.; National Bureau of Economic Research.
Series: NBER working paper series ;; working paper 11039; Working paper series (National Bureau of Economic Research : Online) ;; working paper no. 11039.
Publisher: National Bureau of Economic Research
Published: 2005
Place of publication: Cambridge, MA
Language: eng
Format: Electronic resource
Subjects: Insurance, Long-term care
Description: "We examine whether unregulated, private insurance markets efficiently provide insurance against reclassification risk (the risk of becoming a bad risk and facing higher premiums).  To do so, we examine the ex-post risk type of individuals who drop their long-term care insurance contracts relative to those who are continually insured.  Consistent with dynamic inefficiencies, we find that individuals who drop coverage are of lower risk ex-post than individuals who were otherwise-equivalent at the time of purchase but who do not drop out of their contracts.  These findings suggest that dynamic market failures in private insurance markets can preclude the efficient provision of insurance against reclassification risk"--National Bureau of Economic Research web site.
Notes: Includes bibliographical references.
Title from PDF file as viewed on 2/8/2005.
Also available in print.
System requirements: Adobe Acrobat Reader.
Mode of access: World Wide Web.