Collusion between Retailers and Customers: The Case of Insurance Fraud in Taiwan

Pierre Picard, Jennifer Wang and Kili Wang
Additional contact information
Kili Wang: TKU - Tamkang University [New Taipei]

Working Papers from HAL

Abstract: The outsourcing of retail services is frequently at the origin of agency costs, associated with the discretion in the way retailers do their job. This is particularly the case when retailers and customers collude to exploit loopholes in the contracts between producers and customers. In this paper, we analyze how insurance distribution channels may a¤ect such misbehaviors, when car repairers join policyholders to defraud insurers. We focus attention on the Taiwan automobile insurance market by using a database provided by two large Taiwanese automobile insurers. The theoretical underpinning of our analysis is provided by a model of claims fraud with collusion and audit. Our econometric analysis confirms that fraud occurs through the postponing of claims to the end of the policy year, possibly by filing a single claim for several events. It highlights the role of car dealer agencies in the collusive fraud mechanism..

Date: 2019-02-21
New Economics Papers: this item is included in nep-com, nep-ias, nep-ind and nep-tre
Note: View the original document on HAL open archive server: https://hal.science/hal-02045335v1
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://hal.science/hal-02045335v1/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:wpaper:hal-02045335

Access Statistics for this paper

More papers in Working Papers from HAL
Bibliographic data for series maintained by CCSD ().