A simple insurance model: optimal coverage and deductible

Christopher Gaffney () and Adi Ben-Israel ()

Annals of Operations Research, 2016, vol. 237, issue 1, 263-279

Abstract: An insurance model, with realistic assumptions about coverage, deductible and premium, is studied. Insurance is shown to decrease the variance of the cost to the insured, but increase the expected cost, a tradeoff that places our model in the Markowitz mean-variance model. Copyright Springer Science+Business Media New York 2016

Keywords: Insurance; Optimal coverage; Deductible; Markowitz mean-variance model (search for similar items in EconPapers)
Date: 2016
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DOI: 10.1007/s10479-013-1469-2

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