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Optimal Deductibles: A Theoretical Analysis From An Insured's Perspective, Alexander Kreienbring
Optimal Deductibles: A Theoretical Analysis From An Insured's Perspective, Alexander Kreienbring
Theses and Dissertations
A stop-loss policy as a tool for protection against a large loss is one of the most common insurance forms. For fixed premiums and therefore a uniquely determined insurance deductible, it has been well-established that the stop-loss form is superior to all other common
insurance forms (Arrow, 1963). Using the expected premium principal, one can relax the assumption of a fixed premium and allow the insured to choose an arbitrary deductible that fits their needs.
This thesis presents a stop-loss insurance policy model from an insured's perspective for a flexible premium. It shows the existence and uniqueness of an optimal …