Olivella, Pau; Schroyen, Fred - Institutt for samfunnsøkonomi, Norges Handelshøyskole … - 2011
In this paper, we consider a population of ndividuals who differ in two dimensions: their risk type (expected loss) and their risk aversion. We solve for the profit maximizing menu of contracts that a monopolistic insurer puts out on the market. First, we …nd that it is never optimal to fully...