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The demand for health insurance in a multirisk context

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  • Mohamed Anouar Razgallah

    (GATE - Groupe d'analyse et de théorie économique - UL2 - Université Lumière - Lyon 2 - ENS LSH - Ecole Normale Supérieure Lettres et Sciences Humaines - CNRS - Centre National de la Recherche Scientifique)

Abstract

Using a model of bivariate decision under risk, we analyse the health insurance demand when there are two sources of risk: a health risk and an uninsurable one. We examine how the uninsurable risk affects the coverage of the health risk. We show that the determinants of the demand for health insurance are not only the correlation between the health and uninsurable risks as shown by Doherty and Schlesinger (1983a) and the variation of the marginal utility of wealth with respect to the health status (Rey, 2003) but also the way in which the occurrence of the uninsurable risk affects the marginal utility of wealth.

Suggested Citation

  • Mohamed Anouar Razgallah, 2005. "The demand for health insurance in a multirisk context," Post-Print halshs-00180048, HAL.
    • Handle: RePEc:hal:journl:halshs-00180048
    Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-00180048
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    References listed on IDEAS

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    1. Béatrice Rey, 2003. "A Note on Optimal Insurance in the presence of a Nonpecuniary Background Risk," Theory and Decision, Springer, vol. 54(1), pages 73-83, February.
    2. Philip J. Cook & Daniel A. Graham, 1977. "The Demand for Insurance and Protection: The Case of Irreplaceable Commodities," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 91(1), pages 143-156.
    3. Béatrice Rey, 2003. "A Note on Optimal Insurance in the presence of a Nonpecuniary Background Risk," Post-Print halshs-03352991, HAL.
    4. Evans, William N & Viscusi, W Kip, 1991. "Estimation of State-Dependent Utility Functions Using Survey Data," The Review of Economics and Statistics, MIT Press, vol. 73(1), pages 94-104, February.
    5. Doherty, Neil A & Schlesinger, Harris, 1983. "The Optimal Deductible for an Insurance Policy When Initial Wealth Is Random," The Journal of Business, University of Chicago Press, vol. 56(4), pages 555-565, October.
    6. Doherty, Neil A. & Schlesinger, Harris, 1986. "A note on risk premiums with random initial wealth," Insurance: Mathematics and Economics, Elsevier, vol. 5(3), pages 183-185, July.
    7. Doherty, Neil A & Schlesinger, Harris, 1983. "Optimal Insurance in Incomplete Markets," Journal of Political Economy, University of Chicago Press, vol. 91(6), pages 1045-1054, December.
    8. Eeckhoudt, Louis R & Hammitt, James K, 2001. "Background Risks and the Value of a Statistical Life," Journal of Risk and Uncertainty, Springer, vol. 23(3), pages 261-279, November.
    9. Neil A. Doherty & Harris Schlesinger, 1990. "Rational Insurance Purchasing: Consideration of Contract Nonperformance," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 105(1), pages 243-253.
    Full references (including those not matched with items on IDEAS)

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