Insurance loss coverage and demand elasticities
研究了在保险风险分类受限导致逆向选择时，损失覆盖（即全体人口由保险补偿的期望损失）可能增加的条件，发现当高风险人群的保险覆盖增加超过参保人数下降时，损失覆盖反而上升，这取决于高低风险人群的需求弹性。
Restrictions on insurance risk classification may induce adverse selection, which is usually perceived as a bad outcome. We suggest a counter-argument to this perception in circumstances where modest levels of adverse selection lead to an increase in ‘loss coverage’, defined as expected losses compensated by insurance for the whole population. This happens if the shift in coverage towards higher risks under adverse selection more than offsets the fall in number of individuals insured. The possibility of this outcome depends on insurance demand elasticities for higher and lower risks. We state elasticity conditions which ensure that for any downward-sloping insurance demand functions, loss coverage when all risks are pooled at a common price is higher than under fully risk-differentiated prices. Empirical evidence suggests that these conditions may be realistic for some insurance markets.