Evidence that waste aversion begets insurance aversion
de Meza, D.
, Fessner, L. C. & Reyniers, D. J.
(2015).
Evidence that waste aversion begets insurance aversion.
Economics Letters,
126, 75-77.
https://doi.org/10.1016/j.econlet.2014.11.018
, Fessner, L. C. & Reyniers, D. J.
(2015).
Evidence that waste aversion begets insurance aversion.
Economics Letters,
126, 75-77.
https://doi.org/10.1016/j.econlet.2014.11.018
Paying an insurance premium but not needing to claim is sometimes viewed as pouring money down the drain. Aversion to the perceived waste may lead to the rejection of fair insurance. Although policies paying rebates if no claim is made are not attractive to expected utility maximisers, this paper finds strong evidence they appeal to waste averters..