@techreport{Jametti2004Disaster,
abstract = {We model natural disaster insurance in France. We explicitly take into account the main
institutional features of the system, such as the uniform premium rate in both high and low
risk regions and the existence of a state reinsurance company. Our model indicates that the
institutional set-up is fundamentally flawed. We find that the market is likely to lead to
?specialist? equilibria, where insurers specialize in serving either high or low risk regions. As
a result the reinsurance company, which offers cover to all insurers at the same price, is likely
to suffer from a portfolio with mainly ?bad? risks. We show that increasing the premium rate
customers have to pay, a policy undertaken by the French authorities, will not necessarily
solve these problems and comes at a high cost to the final consumer (and taxpayer).},
author = {Mario Jametti and Thomas von Ungern-Sternberg},
copyright = {http://www.econstor.eu/dspace/Nutzungsbedingungen},
keywords = {L11; G22; D78; 330; property insurance; reinsurance; risk selection; Elementarschadenversicherung; Frankreich},
language = {eng},
number = {1303},
title = {Disaster insurance or a disastrous insurance : natural disaster insurance in France},
type = {CESifo working papers},
url = {http://hdl.handle.net/10419/18668},
year = {2004}
}
