A Review of Insurance and Behavioral Economics: Improving Decisions in the Most Misunderstood Industry

Abstract

This book indeed goes a long way towards clearing up misconceptions about insurance both on the part of consumers and, even more importantly, insurance managers and regulators. However, in the eyes of this reviewer, the authors are too quick to jump on the bandwagon of ‘Behavorial Economics’ in their attempts to explain seeming anomalies in decisionmaking with repect to insurance. This said, the case studies included, statistics cited, and arguments proffered in this the volume make for interesting reading.

Key Words:

• Insurance
• Anomalies in Descisionmaking
• Behavioral Economics
• Regulation of Insurance

JEL classifications:

• D14
• G22
• G28