Evidence that waste aversion begets insurance aversion

de Meza, DavidORCID logo; Fessner, Liza C.; and Reyniers, Diane J.ORCID logo (2015) Evidence that waste aversion begets insurance aversion Economics Letters, 126. pp. 75-77. ISSN 0165-1765
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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..
Item Type Article
Keywords Insurance,waste aversion,no-claim rebate,prospect theory
Departments Management
DOI 10.1016/j.econlet.2014.11.018
Date Deposited 08 Feb 2016 11:11
URI https://researchonline.lse.ac.uk/id/eprint/65272

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