@techreport{NBERw4830,
 title = "Home Equity Insurance",
 author = "Robert J. Shiller and Allan N. Weiss",
 institution = "National Bureau of Economic Research",
 type = "Working Paper",
 series = "Working Paper Series",
 number = "4830",
 year = "1994",
 month = "August",
 URL = "http://www.nber.org/papers/w4830",
 abstract = {Home equity insurance policies, policies insuring homeowners against declines in the price of their homes, would bear some resemblance both to ordinary insurance and to financial hedging vehicles.  A menu of choices for the design of such policies is presented here, and conceptual issues are discussed.  Choices include pass-through futures and options, in which the insurance company in effect serves as a retailer to homeowners of short positions in real estate futures markets or of put options on real estate.  Another choice is a life-event-triggered insurance policy, in which the homeowner pays regular fixed insurance premia and is entitled to a claim if both there is a sufficient decline in the real estate price index and a specified life event (such as a move beyond a certain geographical distance) occurs.  Pricing of the premia to cover loss experience is derived, and tables of break-even policy premia are shown, based on estimated models of Los Angeles housing prices 1971- 91.},
}