Risk Mutualization and Competition in Insurance Markets

  title={Risk Mutualization and Competition in Insurance Markets},
  author={Marie-C{\'e}cile Fagart and Nathalie Fombaron and Meglena Jeleva},
  journal={The Geneva Papers on Risk and Insurance Theory},
The aim of this paper is to analyze the impact of mutual firms on competition in the insurance market. We distinguish two actors in this market: mutual firms, which belong to their pooled members, and traditional companies, which belong to their shareholders. Our approach differs from the literature by one crucial assumption: the expected utility of the consumers depends on the size of their insurance firm, which generates network externalities in this market. Thus, the choice of a contract… CONTINUE READING