An experimental investigation of insurance decisions in low probability and high loss risk situations

Regular Article

Abstract

This experimental study investigates insurance decisions in low-probability, high-loss risk situations. Results indicate that subjects consider the probability of loss (loss size) when they make buying decisions (paying decisions). Most individuals are risk averse with no specific threshold probability.

Keywords

Risk Insurance Low probability High loss  Experiment 

JEL Classification

C91 D81 

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Copyright information

© Springer-Verlag Berlin Heidelberg 2013

Authors and Affiliations

  1. 1.Department of Business AdministrationMiddle East Technical UniversityAnkaraTurkey
  2. 2.Dipartimento di Studi Aziendali e GiusprivatisticiUniversità degli Studi di Bari, Aldo MoroBariItaly
  3. 3.Departament d’EconomiaUniversitat Jaune ICastellónSpain

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