Open Access. Powered by Scholars. Published by Universities.®
- Discipline
Articles 1 - 2 of 2
Full-Text Articles in Law
The Catastrophic Effects Of Natural Disasters On Insurance Markets, W. Kip Viscusi, Patricia Born
The Catastrophic Effects Of Natural Disasters On Insurance Markets, W. Kip Viscusi, Patricia Born
Vanderbilt Law School Faculty Publications
Natural catastrophes often have catastrophic risks on insurance companies as well as on the insured. Using a very large dataset on homeowners insurance coverage by state, by firm, and by year for the 1984 to 2004 period, this paper documents the positive effect on losses and loss ratios of both unexpected catastrophes as well as large events that the authors term "blockbuster catastrophes." Insurers adapt to these catastrophic risks by raising insurance rates, leading to lower loss ratios after the catastrophic event. There is a widespread event of unexpected catastrophes and blockbuster catastrophes that reduces total premiums earned in the …
Insurers, Illusions Of Judgment & Litigation, Chris Guthrie, Jeffrey J. Rachlinski
Insurers, Illusions Of Judgment & Litigation, Chris Guthrie, Jeffrey J. Rachlinski
Vanderbilt Law School Faculty Publications
Insurers play a critical role in the civil justice system. By providing liability insurance to parties who would otherwise be untenable as defendants, insurers make litigation possible. Once litigation materializes, insurers provide representation, pay legal fees, and often play a central role in resolving disputes through settlement or adjudication. In this paper, we explore empirically how these key litigation players make important decisions in the litigation process, like evaluating a case, deciding whether to settle, and if so, on what terms. We find that insurers, though not entirely immune to the effects of cognitive illusions that have been shown to …