Economic Value of Multi-peril Coastal Hazard Insurance

Mona Ahmadiani and Craig Landry

No 252817, 2017 Annual Meeting, February 4-7, 2017, Mobile, Alabama from Southern Agricultural Economics Association

Abstract: Expanding the National Flood Insurance Program to allow policyholders to purchase optional erosion coverage eliminate coverage disputes when erosion and flood both contribute to a loss, and provide affordable national erosion coverage. We examine the household welfare effect of multi-peril hazard insurance coverage by coupling information on NFIP policy in force with a survey data for a sample of coastal households in the US southeast. Our results indicate that the value of multi-peril hazard insurance is substantially higher for households who live in the coastal zone. We also test effect of risk perception (subjective risk assessment) on individuals’ decision to purchase multi-peril hazard insurance and find that higher risk perception lead to higher probability of purchasing multi-peril insurance coverage and increases the mean willingness to pay for insurance.

Keywords: Environmental Economics and Policy; Risk and Uncertainty (search for similar items in EconPapers)
Date: 2017-01
New Economics Papers: this item is included in nep-agr and nep-env
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Persistent link: https://EconPapers.repec.org/RePEc:ags:saea17:252817

DOI: 10.22004/ag.econ.252817

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