TY  - JOUR
AU  - Michel-Kerjan,Erwann
AU  - Raschky,Paul
AU  - Kunreuther,Howard
TI  - Corporate Demand for Insurance:  An Empirical Analysis of the U.S. Market for Catastrophe and Non-Catastrophe Risks
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 17403
PY  - 2011
Y2  - September 2011
UR  - http://www.nber.org/papers/w17403
L1  - http://www.nber.org/papers/w17403.pdf
N1  - Author contact info:
Erwann Michel-Kerjan
The Wharton School
University of Pennsylvania
Center for Risk Management
3730 Walnut Street, 556 JMHH
Philadelphia, PA 19104-6340
Tel: 215-573-0515
Fax: 215-573-2130
E-Mail: erwannmk@wharton.upenn.edu

Paul Raschky
University of Innsbruck
E-Mail: paul.raschky@buseco.monash.edu.au

Howard Kunreuther
Operations and Information Management
The Wharton School
University of Pennsylvania
3730 Walnut Street, 500 JMHH
Philadelphia, PA 19104-6366
Tel: 215/898-4589
Fax: 215/573-2130
E-Mail: kunreuther@wharton.upenn.edu
AB  - Using a unique dataset of insurance decisions by over 1,800 large U.S. corporations, this study provides the first empirical analysis of firm behavior that compares corporate demand for property and catastrophe insurance (here, terrorism). We combine demand and supply data and apply a simultaneous-equation approach to address the problem of endogenous premium decisions. The main finding is that demand for property and catastrophe insurance are not very different and that the demand for catastrophe coverage is actually more price inelastic. We also show that a corporation’s ability to self-insure affects the demand for catastrophe insurance but not for property insurance.
ER  -