Trust and Insurance Contracts

• 成果类型: Article
• 署名作者: Gennaioli, Nicola; La Porta, Rafael; Lopez-de-Silanes, Florencio; Shleifer, Andrei
• 署名单位: Bocconi University; Bocconi University; National Bureau of Economic Research; Universite Cote d'Azur; SKEMA Business School; Harvard University
• 刊物名称: REVIEW OF FINANCIAL STUDIES
• ISSN/ISSBN: 0893-9454
• DOI: 10.1093/rfs/hhab112
• 发表日期: 2022
• 页码: 5287
• 关键词: determinants; claims; FRAUD

摘要

We assemble homeowner insurance claims from 28 independently operated country subsidiaries of a multinational insurance firm. We propose a new insurance model, in which consumers can make invalid claims and firms can deny valid claims, as is common in the data. In the model, trust and honesty shape equilibrium insurance contracts, disputes, and claim payments, especially when disputes are too small for courts. We test the model by investigating claim incidence, dispute, rejection, and payment, as well as insurance costs and pricing across countries. The evidence is consistent with the centrality of trust for insurance markets, as our model predicts. Authors have furnished data/code, which are available on the Oxford University Press Web site next to the link to the final published paper online.