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on Insurance Economics |
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Issue of 2021‒11‒08
fifteen papers chosen by Soumitra K. Mallick Indian Institute of Social Welfare and Business Management |
| By: | Enders, Zeno; Vespermann, David |
| JEL: | F45 F44 E32 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:vfsc21:242430&r= |
| By: | Michele Fioretti (ECON - Département d'économie (Sciences Po) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique); Hongming Wang (Hitotsubashi University) |
| Abstract: | Pay-for-performance is commonly employed to improve the quality of social services contracted out to firms. We show that insurer responses to pay-for-performance can widen the inequality in accessing social services. Focusing on the U.S. Medicare Advantage market, we find that high-quality insurance contracts responded to quality-linked payments by selecting healthier enrollees with premium differences across counties. The selection is profitable because the quality rating fails to adjust for pre-existing health differences of enrollees. As a result, quality improved mostly due to selection, and the supply of high-quality insurance shifted to the healthiest counties. Revising the quality rating could prevent these unintended consequences. |
| Keywords: | Pay-for-Performance,Quality Bonus Payment Demonstration,Medicare Advantage,Risk Selection,Supply-Side Selection,Quality Ratings,Health Inequality |
| Date: | 2019–11–01 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-03393070&r= |
| By: | Marisa Shenk; Gina Livermore |
| Abstract: | This paper examines the work-related overpayment and benefit suspension experiences of recently employed Social Security Disability Insurance and Supplemental Security Income beneficiaries using data from the 2017 National Beneficiary Survey. |
| Keywords: | Disability beneficiaries, disability payments, overpayments, benefit suspensions |
| URL: | http://d.repec.org/n?u=RePEc:mpr:mprres:5fdd297eb0fe428e97ca5a0c98953a96&r= |
| By: | Bruno Coquet (OFCE - Observatoire français des conjonctures économiques - Sciences Po - Sciences Po) |
| Abstract: | Declining unemployment benefits is a popular provision of Unemployment Insurance, due to its intuitive mechanism of financial pressure on benefits recipients. However, it faces strong opposition from the targeted unemployed, and also in the economic literature. Indeed, when analyzing declining UI benefits into a comprehensive landscape of the various aspects of unemployment insurance, a large majority of economic studies rule out this design, theory largely favors constant or progressive benefits and, despite the immediate gains of a declining pattern as regards exits from unemployment and a fall of insurance expenditure, economic evaluations conclude to many adverse effects. In practice, only a minority of countries similar to France have implemented declining UI benefits. Despite this inauspicious background the insurer may choose this formula preventing the odds: if so, declining benefits should be part of a coherent set of UI rules, allowing for positive effects to materialize and preventing adverse effects. Reviewing the rules that will soon be implemented in France, five aspects are highlighted that could raise difficulties. We propose operational solutions that can shed light and feed the round of negotiation currently underway. |
| Abstract: | La dégressivité des allocations chômage est une disposition populaire, car sa mécanique intuitive de pression financière sur les chômeurs possède la force de l'évidence ; elle fait cependant face à une forte opposition des chômeurs concernés, et dans la littérature économique. En effet, cette dernière replace la dégressivité au sein du panorama complet des différents aspects de l'assurance chômage, ce qui conduit très majoritairement à écarter cette modalité : la théorie plaide largement en faveur de profils constants ou progressifs, et si les gains immédiats de la dégressivité en termes de sorties du chômage et de baisse des dépenses d'assurance à court terme sont le plus souvent au rendez-vous, les évaluations observent de nombreux effets délétères. En pratique, la dégressivité n'est en vigueur que dans une petite minorité de pays comparables à la France. Si l'assureur choisit de retenir cette formule, il doit malgré tout inscrire la dégressivité dans un schéma cohérent permettant d'optimiser ses effets positifs et de prévenir ses effets indésirables, qui sont illustrés ici au travers de cinq aspects qui pourraient soulever des difficultés, en regard desquelles nous proposons des solutions pouvant éclairer la concertation actuellement en cours. |
| Keywords: | unemployment insurance,unemployment benefits,replacement rate,assurance chômage,allocations chômage,taux de remplacement |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-03370452&r= |
| By: | Regele, Fabian; Gründl, Helmut |
| Abstract: | Historical evidence like the global financial crisis from 2007-09 highlights that sector concentration risk can play an important role for the solvency of insurers. However, current microprudential frameworks like the US RBC framework and Solvency II consider only name concentration risk explicitly in their solvency capital requirements for asset concentration risk and neglect sector concentration risk. We show by means of US insurers' asset holdings from 2009 to 2018 that substantial sectoral asset concentrations exist in the financial, public and real estate sector, and find indicative evidence for a sectoral search for yield behavior. Based on a theoretical solvency capital allocation scheme, we demonstrate that the current regulatory approaches can lead to inappropriate and biased levels of solvency capital for asset concentration risk, and should be revised. Our findings have also important implications on the ongoing discussion of asset concentration risk in the context of macroprudential insurance regulation. |
| Keywords: | Microprudential Insurance Regulation,Asset Concentration Risk,Systematic Risk,Idiosyncratic Risk,Sectoral Asset Diversification |
| JEL: | G01 G11 G22 G28 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:icirwp:4021&r= |
| By: | Stéphane Auray (OFCE - Observatoire français des conjonctures économiques - Sciences Po - Sciences Po); Aurélien Eyquem (GATE - Groupe d'analyse et de théorie économique - UL2 - Université Lumière - Lyon 2 - ENS LSH - Ecole Normale Supérieure Lettres et Sciences Humaines - CNRS - Centre National de la Recherche Scientifique, CREM - Centre de recherche en économie et management - CNRS - Centre National de la Recherche Scientifique - UR1 - Université de Rennes 1 - UNIV-RENNES - Université de Rennes - UNICAEN - Université de Caen Normandie - NU - Normandie Université, GREDI - Groupe de recherche en économie et développement international [Sherbrooke] - UdeS - Université de Sherbrooke) |
| Abstract: | A tractable incomplete-market model with unemployment, sticky prices, and a fiscal side is used to quantify the macroeconomic effects of lockdown policies and the miti-gating effects of raising government spending and implementing UI benefit extensions. We find that the effects of lockdown policies, although we are relatively conservative about the size of the lockdown, are huge: unemployment doubles on impact and al-most triples even for relatively short lockdown durations. Output falls dramatically and debt-output ratios increase by several tens of percentage points. In addition, the surge in unemployment risk triggers a rise in precautionary savings that make such shocks Keynesian supply shocks: aggregate demand falls by more than aggregate supply, and lockdown policies are deflationary. Unfortunately, we find that raising public spending and extending UI benefits stimulate aggregate demand or improve risk-sharing but has little effects on output and unemployment, although they do alleviate the welfare losses of lockdown policies for the households. |
| Keywords: | Lockdown,Unemployment,Borrowing constraints,Incomplete markets,Government spending,Unemployment insurance |
| Date: | 2020–04–16 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-03389198&r= |
| By: | Éloi Laurent (OFCE - Observatoire français des conjonctures économiques - Sciences Po - Sciences Po) |
| Abstract: | This article proposes, in the light of the French case, to consider building a social-ecological protection aimed at reducing the health and economic impact of the heatwaves caused by climate change by answering five successive questions: why protect? Protect from what? What to protect? Whom to protect? How to protect? |
| Abstract: | Cet article propose, à la lumière du cas français, des éléments d'analyse en vue de l'édification d'une protection sociale-écologique visant à atténuer l'impact sanitaire et économique des fortes chaleurs engendrées par le dérèglement climatique, en répondant à cinq questions successives : Pourquoi protéger ? De quoi protéger ? Que protéger ? Qui protéger ? Comment protéger ? |
| Keywords: | France,heatwaves,elderly,social-ecological risk,insurance |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-03373456&r= |
| By: | Vanessa Cirulli; Giuliano Resce; Marco Ventura |
| Abstract: | This paper investigates the causal effect of co-payment exemption on the utilization of healthcare services with a particular emphasis on the number of specialist visits in the Italian National Health System (NHS). As the co-payment exemption may be considered as a sort of insurance, a relevant research question is to ask whether such a protection has had any effect on healthcare services utilization. Exploiting a discontinuity in the multiple eligibility criteria for co-payment exemption, we apply Multiple Regression Discontinuity (MRD) in a quasi-experimental setting, considering both age and income requirements.This discontinuity also allows us to identify the effect of co-payment on a particularly fragile sub-population of less wealthy people. Our findings provide convincing evidence of a positive and significant effect of co-payment exemption on the number of specialist visits. The result may be useful to the policy maker to tailor ad-hoc policies aimed at disadvantaged sub-populations. |
| Keywords: | Healthcare; Co-payment; Demand effects; Multiple Regression Discontinuity; National Health System |
| JEL: | I11 I14 I18 |
| Date: | 2021–10 |
| URL: | http://d.repec.org/n?u=RePEc:sap:wpaper:wp203&r= |
| By: | Mathithibane, Mpho Steve |
| Abstract: | The aim of this paper is to investigates the influence of trust on insurance penetration in the developing Microinsurance sector of South Africa. Legacy issues and deeply rooted structural and institutional frailties have resulted in substandard levels of financial inclusion for low-income earners in the country. This segment of consumers is highly vulnerable to social, economic and as the covid-19 pandemic has proved, health shocks. Microinsurance has often been touted as a solution to improve resilience and turn the tide of significant adverse economic outcomes for the low-income segment. This paper explores the role of trust as a key construct for business success in the microinsurance sector. The study findings indicate that creation of trust and reassurance that claims will be honored when liability occurs are the main elements valued by prospective and existing microinsurance consumers. These findings contribute to advancing knowledge within the microinsurance segment, in particular, key traits needed in constructing a successful insurance programme as well as the messaging and serving element that needs to be placed at the forefront of product design and marketing in order to build trust. |
| Keywords: | Microinsurance, low-income market, South Africa |
| JEL: | D18 G22 |
| Date: | 2021–10–28 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:110406&r= |
| By: | Kummer, Michael E.; Laitenberger, Ulrich; Rich, Cyrus E.; Hughes, Danny R.; Ayer, Turgay |
| Abstract: | We show that review platforms reduce healthcare interruptions for patients looking for a new physician. We employ a difference-in-differences strategy using physician retirements as a 'disruptive shock' that forces patients to find a new physician. We combine insurance claims data with web-scraped physician reviews and highlight a substantial care-gap resulting from a physician's retirement. We then show that online physician reviews reduce this gap and help patients find a new physician faster. Our results are robust to including a variety of controls and various instruments for the availability of physician reviews, but are not found for patients of nonretiring physicians. By reducing interruptions in care, reviews can improve clinical outcomes and lower costs. |
| Keywords: | Healthcare,Online physician ratings,Online physician reviews,Care-gap |
| JEL: | I1 I11 I2 O33 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:21075&r= |
| By: | Bruno Coquet (OFCE - Observatoire français des conjonctures économiques - Sciences Po - Sciences Po) |
| Abstract: | The wage to be replaced is a key parameter to providing optimal unemployment insurance. In France, the so called "reference-wage" rules used until 2019 created large inequalities, between unemployed with splintered employment backgrounds and others. Indeed the insurer paid benefits implying monthly replacement well above 100%, to more than a fifth of eligible unemployed, namely those with low work intensity during the qualifying period. This setting subsidized employers using short-term contracts, contributing to the steady increase of these labor contracts, and of related insurance spending. To fully understand this complex problem, we break it down. It's clear that what is commonly viewed as a reference wage problem, is in fact mainly a by-product of eligibility rules. Looking for a better control the reference wage, without having properly controlled eligibility, as well as how an unemployed built his employment history, necessarily leads to a sub-optimal formula, and misleading incentives. There is no magic formula to compute the reference wage. First of all, eligibility rules split non-eligible unemployed that have a zero replacement rate and those eligible to unemployment benefits. Then, for the latter, the regularity with which rights were acquired should be taken into account, as well as the involuntary nature of unemployment spells between contracts into fragmented employment histories. Being linked to behavior, or contributions, such criteria are much better than meaningless parameters only aimed at biasing the reference wage computation. Finally, the reference wage formula is somewhere half way from two imperfect ends: daily wage for only the days worked, which prevailed during decades, or the average wage over the qualifying period which was to replace it in 2019. |
| Abstract: | La définition du salaire que doit remplacer l'assurance chômage est une question fondamentale. La règle en vigueur jusqu'en 2019 devait être changée car elle engendrait de fortes inégalités entre les chômeurs ayant des historiques d'emploi fractionnés et les autres. Le taux de remplacement théorique pouvait en effet dépasser 100% et, cela se produisant très souvent, l'usage des contrats courts s'en trouvait stimulé. Pour bien comprendre ce problème complexe, nous le décomposons. Il apparaît alors clairement que ce qui se manifeste au travers du salaire de référence, ce sont d'abord les effets des règles d'éligibilité à l'assurance chômage. Vouloir contrôler le salaire de référence sans auparavant bien contrôler l'éligibilité, ainsi que la manière dont les chômeurs constituent leur historique d'emploi, aboutit nécessairement à une formule imparfaite, inégalitaire, diffusant de mauvaises incitations. Il n'existe pas de formule magique du salaire de référence. Avant tout, les règles d'éligibilité départagent les chômeurs non-éligibles, qui ont un taux de remplacement nul, et ceux admis en indemnisation. Puis, pour ces derniers, il est souhaitable de tenir compte de la régularité avec laquelle les droits ont été acquis, et du caractère involontaire des périodes entre deux contrats lorsque l'historique d'emploi est fractionné. Ces critères sont objectifs et en cela bien préférables à des paramètres abstraits visant à contraindre le résultat de la formule du salaire de référence, sans lien avec les comportements ou les contributions. Enfin, en dernier lieu, la formule du salaire de référence doit se trouver à mi-chemin des deux extrêmes imparfaits que sont le salaire journalier des seuls jours travaillés, ou le salaire moyen sur la période servant à ouvrir les droits qui devait le remplacer en 2019. |
| Keywords: | unemployment insurance,unemployment benefits,replacement rate,assurance chômage,allocations chômage,taux de remplacement |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-03364085&r= |
| By: | Frederic Boissay; Torsten Ehlers; Leonardo Gambacorta; Hyun Song Shin |
| Abstract: | The business model of big techs rests on enabling direct interactions among a large number of users on digital platforms, such as in e-commerce, search and social media. An essential by-product is their large stock of user data, which they use to offer a wide range of services and exploit natural network effects, generating further user activity. Increased user activity completes the circle, as it generates yet more data. Building on the self-reinforcing nature of the data- network-activities loop, some big techs have ventured into financial services, including payments, money management, insurance and lending. The entry of big techs into finance promises efficiency gains and greater financial inclusion. At the same time, it introduces new risks associated with market power and data privacy. The nature of the new trade-off between efficiency and privacy will depend on societal preferences, and will vary across jurisdictions. This increases the need to coordinate policies both at the domestic and international level. |
| JEL: | E51 G23 O31 |
| Date: | 2021–10 |
| URL: | http://d.repec.org/n?u=RePEc:bis:biswps:970&r= |
| By: | Bruno Coquet (OFCE - Observatoire français des conjonctures économiques - Sciences Po - Sciences Po) |
| Abstract: | In case of economic redundancy employees are entitled to e-employment support schemes that depends on the workforce size of the employer. Whether the company is small or large the worker's choice is limited to accepting or refusing the device imposed by law "Redeployment leave" or "Professional Security Contract" (CSP). However, these two schemes are very different. On the one hand, CSP provides good financial security to the unemployed and increases his chances to find a new job. On the other hand, the Redeployment leave is an obsolete formula, based on unverified a priori, that the State no longer monitors or finances for years, a leap into the unknown for the employee. The introduction of new "mutually agreed terminations" in 2008 and the recent unemployment insurance reform have further complicated the choices available to redundant employees. This paper highlights inequalities weighting on these workers as regards information, rights and financial security, depending neither on their profile nor their behavior, but only on the status of their employer and inconsistent rules. Simple reforms could restore fairness and increase re-employment opportunities following redundancy. At least, the legal and financial parameters should be the same for the two existing schemes, or the right to choose the CSP regardless of the size of the company could be introduced, especially as this would not entail any additional costs for the company. A more ambitious reform could generalize the CSP, matching it with a financing of the reemployment support scheme by the employer. This contribution would replace the current cost of the company's internal reemployment support scheme, growing with the company's contributory capacities, of which size is only one aspect. It is also wise to see further. Indeed, as economic dismissal became a marginal form of terminating a labour contract, the economic motive for ending labour contracts remains the main cause of separation. Linking re-employment leave schemes only to terminations of indefinite duration contracts labelled as "economic" hinders equal access to efficient schemes that would increase unemployed financial security as well as their future employment opportunities. |
| Abstract: | Le dispositif de reclassement dont peut bénéficier un salarié licencié économique dépend de l'effectif total de l'entreprise qui l'emploie : selon que celle-ci est petite ou grande, le choix du salarié se limite donc à accepter ou refuser le dispositif qu'impose la loi, Congé de reclassement ou Contrat de Sécurisation Professionnelle (CSP). Cette inégalité a de grande conséquences car ces deux dispositifs sont très différents. D'un côté le CSP sécurise bien le chômeur et accroît ses chances de reclassement. De l'autre le Congé de reclassement est un dispositif obsolète, basé sur des a priori dont nul ne vérifie la réalité, que l'État ne suit ni ne finance plus depuis longtemps, un saut dans l'inconnu pour le salarié. L'introduction de la rupture conventionnelle en 2008 et la réforme récente de l'assurance chômage ont encore compliqué le choix entre les options ouvertes à ces salariés. Nous mettons ici en évidence les inégalités d'information, de droits et de sécurité financière, qui s'imposent à ces salariés en voie de licenciement économique et qui ne dépendent ni de leur profil ni de leurs comportements mais seulement du statut de leur employeur et de réglementations incohérentes. Des réformes simples pourraient rétablir l'équité et augmenter les chances de reclassement à la suite d'un licenciement économique. Il s'agirait a minima d'homogénéiser les procédures et les paramètres des deux dispositifs existants, ou tout simplement d'ouvrir un droit d'option pour que tous les licenciés économiques qui le souhaitent puissent opter pour le CSP, quelle que soit la taille de l'entreprise qui les emploie – celle-ci ne supportant aucun coût supplémentaire. Une réforme plus ambitieuse pourrait consister à généraliser le CSP en l'assortissant à un financement de l'accompagnement du salarié par l'employeur. Un tel abondement remplacerait les budgets actuellement investis par l'entreprise dans le dispositif qu'elle doit mettre en place ex-nihilo, et pourrait être fonction de la capacité contributive de l'entreprise dont la taille de l'effectif n'est qu'un aspect. Il est aussi opportun de voir plus loin, car si le licenciement économique est devenu une modalité marginale de rupture du contrat de travail, le motif économique des fins de contrat reste la cause majoritaire de séparation. Lier le reclassement aux seules ruptures de CDI officiellement labellisées comme ayant un motif économique a pour effet de priver de nombreux chômeurs d'un accès égal à des droits qui augmenteraient leur sécurité et leurs chances de reclassement. |
| Keywords: | layoffs,unemployment insurance,licenciement,assurance chômage,reclassement |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-03373480&r= |
| By: | Fels, Markus |
| JEL: | D01 D81 G22 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:vfsc21:242418&r= |
| By: | Brassel S.; Neri M.; Schirrmacher H.; Steuten L. |
| Abstract: | The NHS is facing unprecedented health system pressure, with a record number of patients waiting for care, while their underlying condition is potentially worsening due to exceptionally long waits. When there is excess demand for health care, treating one patient means losing the opportunity to treat another. These opportunity costs demonstrate the need to consider health system capacity value, one of the so-called 'broader value elements' that is often not fully captured in traditional value assessments. Vaccinations against potentially severe diseases can prevent hospitalisations. For each hospital admission prevented, vaccination accrues direct savings to the health system by not having to treat that patient and avoids the opportunity cost of not being able to use the hospital bed for another patient. In 'normal times' where hospital capacity is typically available (or can be expected to free up within a relatively short time), that opportunity cost is zero. Hence this is not usually considered in value assessment. When there are waiting lists, however, it is positive and potentially large. This report shows that the opportunity cost saved through vaccination rises with increasing levels of excess demand for treatment and the increasing share of patients whose conditions become more severe due to a treatment delay. Using a novel approach, we estimate that the opportunity costs saved by four selected vaccination programmes are about twice the direct savings from prevented hospitalisations. Hence, vaccinations may be substantially undervalued when their broader health system capacity value is not fully accounted for. This approach is important for policymakers and relevant for any health technology that significantly reduces or prevents the need for healthcare resources across various care sectors and for which today's demand already exceeds the relevant capacity. |
| Keywords: | Value, Affordability, and Decision Making |
| JEL: | I1 |
| Date: | 2021–10–01 |
| URL: | http://d.repec.org/n?u=RePEc:ohe:conrep:002386&r= |