Written for advanced undergraduate and master s level courses, this book builds from a base of asymmetric information issues to discuss a wide array of topics and is illustrated with some timely examples.
Covers diverse issues such as risk aversion, expected utility, and moral hazard within the pure theory of insurance
Provides a clear exposition of the necessary mathematics, a feature which cannot be found in readers on the topic
Utilizes an undergraduate economics major level of math
Uses the simplest economic models possible to keep the text intuitive
Introduces more mathematically complex techniques such as basic optimization for students wishing to 'go further' in their analysis
S. Hun Seog is Professor of Finance and Insurance at the Graduate School of Business, Seoul National University. He received his PhD in Risk and Insurance from the Wharton School. His research areas include the economics of risk and insurance, corporate finance, and their applications. His academic papers have been published in Journal of Risk and Insurance , Geneva Papers on Risk and Insurance Theory , Asia-Pacific Journal of Risk and Insurance , International Economic Review , Marketing Science , and European Journal of Operational Research.
0. Introduction. Part I: Fundamentals of Insurance. 1. Risk and Expected Utility. 2. Risk Aversion and Riskiness. 3. Principles of Insurance: Risk Sharing and Transfer. Part II: Demand for Insurance and Insurance Contract. 4. Risk Aversion and Insurance. 5. Corporate Insurance and Risk Management. 6. Liability and Insurance. Part III: Information and Insurance Contract. 7. Basic Adverse Selection Models. 8. Advanced Topics in Adverse Selection. 9. Moral Hazard. 10. Ex Post Moral Hazard and Fraud. Part IV: Insurance Market. 11. Insurer Organization. 12. Competition in the Insurance Market. 13. Insurance Cycle and Capacity. Part V: Insurer Management. 14. Insurance Distribution Systems. 15. Insurance Pricing.