Framing, probability distortions, and insurance decisions

@article{Johnson1993FramingPD,
  title={Framing, probability distortions, and insurance decisions},
  author={Eric J. Johnson and John C. Hershey and Jacqueline R. Meszaros and Howard Kunreuther},
  journal={Journal of Risk and Uncertainty},
  year={1993},
  volume={7},
  pages={35-51}
}
A series of studies examines whether certain biases in probability assessments and perceptions of loss, previously found in experimental studies, affect consumers' decisions about insurance. Framing manipulations lead the consumers studied here to make hypothetical insurance-purchase choices that violate basic laws of probability and value. Subjects exhibit distortions in their perception of risk and framing effects in evaluating premiums and benefits. Illustrations from insurance markets… 
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