Determinants of insurance demand against forest fire risk: an empirical analysis of French private forest owners

Marielle Brunette () and Stéphane Couture
Authors registered in the RePEc Author Service: Serge Garcia

No 2016-01, Working Papers - Cahiers du LEF from Laboratoire d'Economie Forestiere, AgroParisTech-INRA

Abstract: In this article, we combine experimental data and individual data on French private forests to estimate the forest owners’ insurance demand against fire risk. Our econometric analysis consists in estimating both insurance participation and coverage-level decision from a field experiment. The estimation method accounts for sample selection issues coming from observed insurance decision and correlation between insurance choice and willingness to pay (WTP). Our results clearly show that, while past public assistance has no significant effect on insurance participation, the experimental type of public assistance program has. Other attributes of the experiment such as the expected loss only explains WTP variations, whereas the existence of an ambiguity concerning the probability of fire occurrence positively affects both insurance participation and WTP levels. Finally, our results are discussed in connection with potential brakes to the development of the insurance market.

Keywords: climate change; adaptation; externality; PPPs (search for similar items in EconPapers)
JEL-codes: C51 D81 Q23 Q28 (search for similar items in EconPapers)
Pages: 31 pages
Date: 2016-01, Revised 2016-01
References: Add references at CitEc
Citations: View citations in EconPapers (2)

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http://www6.nancy.inra.fr/lef/Cahiers-du-LEF/2016/2016-01 First version, 2010

Related works:
Working Paper: Determinants of insurance demand against forest fire risk: an empirical analysis of French private forest owners (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:lef:wpaper:2016-01

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