A simple insurance model: optimal coverage and deductible

Christopher Gaffney; Adi Ben-Israel

doi:10.1007/s10479-013-1469-2

A simple insurance model: optimal coverage and deductible

Christopher Gaffney, Adi Ben-Israel

Mgmt Science & Info Systems

Research output: Contribution to journal › Article › peer-review

2 Scopus citations

Abstract

An insurance model, with realistic assumptions about coverage, deductible and premium, is studied. Insurance is shown to decrease the variance of the cost to the insured, but increase the expected cost, a tradeoff that places our model in the Markowitz mean-variance model.

Original language	English (US)
Pages (from-to)	263-279
Number of pages	17
Journal	Annals of Operations Research
Volume	237
Issue number	1-2
DOIs	https://doi.org/10.1007/s10479-013-1469-2
State	Published - Feb 1 2016

All Science Journal Classification (ASJC) codes

Decision Sciences(all)
Management Science and Operations Research

Keywords

Deductible
Insurance
Markowitz mean-variance model
Optimal coverage

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title = "A simple insurance model: optimal coverage and deductible",

abstract = "An insurance model, with realistic assumptions about coverage, deductible and premium, is studied. Insurance is shown to decrease the variance of the cost to the insured, but increase the expected cost, a tradeoff that places our model in the Markowitz mean-variance model.",

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