Splitting Risks in Insurance Markets In Adverse Selection

Pierre Picard (1)

1 X - École polytechnique

We characterize the design of insurance schemes when policyhold- ers face several insurable risks in a context of adverse selection. Split- ting risks emerges as a feature of second-best Pareto-optimal alloca- tions. This may take the form of risk-speci…c contracts, or of con- tracts where risks are bundled, but subject to di⁄erential coverage rules such as risk speci…c copayments, combined with a deductible, an out-of-pocket maximum or a cap on coverage.

Mots clés: Insurance; adverse selection; contract; health insurance; copayment; deductible

Domaines: Economies et finances

Pierre Picard. Splitting Risks in Insurance Markets In Adverse Selection. 2017. ⟨hal-01448322v1⟩