Moral Hazard and Experience Rating: An Empirical Analysis (Revision)

摘要

For many years, economists and actuaries have studied multiperiod insurance contracts independently and differently. The paper aims to reduce the gap between empirical studies on the determination of insurance premiums and theoretical studies on moral hazard and experience rating. The first objective is to verify empirically the proposition that past experience is a good predictor of risk by using data from a random sample consisting of 19,013 drivers. The second objective is to use the results to construct a multiperiod pricing formula for automobile insurance in order to reduce the ill-effects of moral hazard.