Abstract
This chapter presents a model of the demand for insurance company shares and insurance policies. Individuals in the model respond to uncertainty about real assets by purchasing insurance policies and insurance company shares. Insurance firms arise naturally in the model as risk-sharing devices. This chapter analyzes the nature of individual demand functions to establish equilibrium prices for insurance policies and insurance shares. Although the chapter focuses on insurance activity, equilibrium prices for securities and real assets also are derived.
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© 1987 Springer Science+Business Media New York
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Turner, A.L. (1987). Insurance in an Equilibrium Asset-Pricing Model. In: Cummins, J.D., Harrington, S.E. (eds) Fair Rate of Return in Property-Liability Insurance. Huebner International Series on Risk, Insurance and Economic Security, vol 6. Springer, Dordrecht. https://doi.org/10.1007/978-94-015-7753-3_4
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DOI: https://doi.org/10.1007/978-94-015-7753-3_4
Publisher Name: Springer, Dordrecht
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