The customer, the insurer and the market

Christophe Dutang ()
Additional contact information
Christophe Dutang: LSAF - Laboratoire de Sciences Actuarielle et Financière - UCBL - Université Claude Bernard Lyon 1 - Université de Lyon

Post-Print from HAL

Abstract: Price elasticity studies analyze how customers react to price changes. In this paper, we focus on their effect on the renewal of non-life insurance contracts. Every year insurers face the recurring question of adjusting premiums. Where is the trade off between increasing premium to favour higher projected profit margins and decreasing premiums to obtain a greater market share? Regression models are used to explore the triangular relationship of the customer, the insurer and the market. We conclude that the latter cannot be ignored if we want to get reliable lapse predictions. Furthermore, we also investigate empirical evidence of adverse selection and study its potential impact on lapse decisions.

Keywords: price elasticity; non-life insurance; regression modelling; generalized linear models (search for similar items in EconPapers)
Date: 2012-07
Note: View the original document on HAL open archive server: https://hal.science/hal-01616152v1
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Published in Bulletin Français d'Actuariat, 2012

Downloads: (external link)
https://hal.science/hal-01616152v1/document (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-01616152

Access Statistics for this paper

More papers in Post-Print from HAL
Bibliographic data for series maintained by CCSD ().