Pay-As-You-Go Insurance: Experimental Evidence on Consumer Demand and Behavior

• 成果类型: Article
• 署名作者: Kluender, Raymond
• 署名单位: Harvard University
• 刊物名称: REVIEW OF FINANCIAL STUDIES
• ISSN/ISSBN: 0893-9454
• DOI: 10.1093/rfs/hhad080
• 发表日期: 2024
• 页码: 1118
• 关键词: liquidity constraints

摘要

Pay-as-you-go contracts reduce minimum purchase requirements, which may increase market participation. This paper randomizes the introduction and price(s) of a novel pay-as-you-go contract to the California auto insurance market, where 17% of drivers are uninsured. The pay-as-you-go contract increases take-up by 10.8 p.p. (89%) and days with coverage by 4.6 days over the 3-month experiment (27%). Demand is relatively inelastic, and pay-as-you-go increases insurance coverage in part by relaxing liquidity requirements: most drivers' purchasing behavior is consistent with a cost of credit in excess of payday lending rates, and 19% of drivers have a purchase rejected for insufficient funds.Authors have furnished an , which is available on the Oxford University Press Web site next to the link to the final published paper online