Journal of Risk and Insurance

This academic risk management and insurance journal provides research in industrial organization of insurance markets, management of risks in the private and public sectors, insurance regulation and more.

Articles from Vol. 68, No. 3, September

Alaska Supreme Court Affirms Broad Power and Discretion of Arbitrators in UIM Claim
ALASKA SUPREME COURT AFFIRMS BROAD POWER AND DISCRETION OF ARBITRATORS IN UIM CLAIM Wing v. GEICO Insurance Co., 17 P.3d 783 (Alaska 2001) Ursula Wing's car was hit in the rear by another driver's car in August 1994 and incurred economic loss, medical...
Alaska Supreme Court Affirms Broad Power and Discretion of Arbitrators in UIM Claim. (Recent Court Decisions)
Wing v. GEICO Insurance Co., 17 P.3d 783 (Alaska 2001) Ursula Wing's car was hit in the rear by another driver's car in August 1994 and incurred economic loss, medical damages, and noneconomic loss. GEICO, her insurer, made preliminary payments...
Business Activities Exclusion in Homeowners Policy Operates to Preclude Coverage for Claim by Injured Worker Building Horse Barn That Was to Be Used in Policyholder's Side Business
BUSINESS ACTIVITIES EXCLUSION IN HOMEOWNERS POLICY OPERATES TO PRECLUDE COVERAGE FOR CLAIM BY INJURED WORKER BUILDING HORSE BARN THAT WAS To BE USED IN POLICYHOLDER'S SIDE BUSINESS Bowman v. Allstate Insurance Co., 238 RM 468 (2dCir., 2001). Homeowners...
Business Activities Exclusion in Homeowners Policy Operates to Preclude Coverage for Claim by Injured Worker Building Horse Barn That Was to Be Used in Policyholder's Side Business. (Recent Court Decisions)
Bowman v. Allstate Insurance Co., 238 F.3d 468 (2dCir., 2001). Homeowners insurance typically provides a relatively modest amount of liability coverage (e.g., $100,000, subject to increase by endorsement). Insurers are willing to include this in...
California Aligns with Courts Finding No Coverage for Pollution Costs Imposed on Policyholder Administrative Agency
CALIFORNIA ALIGNS WITH COURTS FINDING No COVERAGE FOR POLLUTION COSTS IMPOSED ON POLICYHOLDER ADMINISTRATIVE AGENCY Certain Underwriters at Lloyd's, London v. Superior Court, 24 Cal. 4th 945, 16 P.3d 94,103 Cal. Rptr.2d 672 (Cal. 2001) Powerine Oil Company,...
California Aligns with Courts Finding No Coverage for Pollution Costs Imposed on Policyholder Administrative Agency. (Recent Court Decisions)
Certain Underwriters at Lloyd's, London v. Superior Court, 24 Cal. 4th 945,16 P.3d 94,103 Cal. Rptr.2d 672 (Cal. 2001) Powerine Oil Company, an oil refiner, was the target of several administrative proceedings concerning environmental claims. Specifically,...
California Supreme Court Adopts "Economic Loss" Limitationon Defective Construction Claims, as Does Nevada Supreme Court. (Recent Court Decisions)
Aas v. Superior Court, 12 P.3d 1125, 101 Cal. Rptr. 2d 718 (Cal. 2000). Calloway v. City of Reno, 993 P.2d 1259 (Nev. 2000). One theory of the law is that, for every wrong done, there should be a remedy. The notion is largely but not completely...
California Supreme Court Adopts "Economic Loss" Limitation on Defective Construction Claims, as Does Nevada Surpreme Court
CALIFORNIA SUPREME COURT ADOPTS "ECONOMIC LOSS" LIMITATION ON DEFECTIVE CONSTRUCTION CLAIMS, AS DOES NEVADA SUPREME COURT Aas v. Superior Court, 12 P.3d 1125, 101 Cal. Rptr. 2d 718 (Cal. 2000). Calloway v. City of Reno, 993 P.2d 1259 (Nev. 2000). One...
Cooperative Decision Making under Risk
Cooperative Decision Making Under Risk, by Jeroen Suijs, 1999, Norwell, Mass.: Kluwer Academic Publishers Reviewer: Emilio Venezian, Rutgers University This book is part of the series "Game Theory, Mathematical Programming, and Mathematical Economics"...
History of Insurance
History of Insurance, Seven Volumes, edited by David Jenkins and Takau Yoneyama, 2000, London: Pickering & Chatto Reviewer: Warren T. Hope, Temple University Writing history rests on an act of faith. It requires a belief in humanity's ability to...
Illinois Supreme Court Enforces Automobile Exclusion in Liability Policy, Precluding Coverage for School District in Serious Tort Matter
ILLINOIS SUPREME COURT ENFORCES AUTOMOBILE EXCLUSION IN LIABILITY POLICY, PRECLUDING COVERAGE FOR SCHOOL DISTRICT IN SERIOUS TORT MATTER Northbrook Property & Casualty Co. v. Transport Joint Agreement, 741 N.E.2d 253 (Ill. 2000). On October 25, 1995,...
Illinois Supreme Court Enforces Automobile Exclusion in Liability Policy, Precluding Coverage for School District in Serious Tort Matter. (Recent Court Decisions)
Northbrook Property & Casualty Co. v. Transport Joint Agreement, 741 N.E.2d 253(Ill.2000). On October 25, 1995, a train collided with a school bus operated jointly by several Illinois school districts. "Several students were killed and many...
Insurer Ownership Structure and Executive Compensation as Complements
ABSTRACT The authors apply results on complementarities to theories of insurance companies' choices of ownership structure and executive compensation. They identify minimal restrictions on the interaction between firm policies and exogenous characteristics...
Insurer's Misappropriation of Policyholder's Expert Witness in UIM Proceeding Constitutes Bad Faith, but Insurer Defending UIM Claim Does Not Act in Bad Faith by Asserting
INSURERS MISAPPROPRIATION OF POLICYHOLDERS EXPERT WITNESS IN UIM PROCEEDING CONSTITUTES BAD FAITH, BUT INSURER DEFENDING UIM CLAIM DOES NOT ACT IN BAD FAITH BY ASSERTING COMPARATIVE FAULT DEFENSE AGAINST POLICYHOLDER Ellwein v. Hartford Accident and...
Insurer's Misappropriation of Policyholder's Expert Witness in UIM Proceeding Constitutes Bad Faith, but Insurer Defending UIM Claim Does Not Act in Bad Faith by Asserting Comparative Fault Defense against Policyholder. (Recent Court Decisions)
Ellwein v. Hartford Accident and Indemnity Co., 15 P.3d 640 (Wash. 2001) (enbanc) Nancy Ellwein was seriously injured in a 1989 auto accident, suffering permanent injuries that affected her brain function and vision. Unfortunately, she had the further...
Intra-Industry Signals Resulting from Insurance Company Mergers
ABSTRACT Given the increasing consolidation in the insurance industry, the authors' objective is to determine how the market revalues the acquirer, target, and rival insurance companies in response to merger announcements. The authors find that...
Introduction to Aviation Insurance and Risk Management
Introduction to Aviation Insurance and Risk Management, by Alexander T. Wells and Bruce D. Chadbourne, 2000, Malabar, Fla.: Kreiger Publishing Company Reviewer: Louis E. Nunez, Reliance Insurance, Aviation Division This is the second edition of a text...
Liability Distributions for Mortgage Insurance
ABSTRACT Option models can provide not only the value of an insurance policy, but also more disaggregated information concerning those precise circumstances under which defaults occur and, hence, insurance payouts must be made. The value of the...
Mitigating Insurance Fraud: Lump-Sum Awards, Premium Subsidies, and Indemnity Taxes
ABSTRACT Governments have many tax tools at their disposal to redistribute wealth from one segment of the population to another, such as income, sales, and lump-sum taxes (for example, setup fees for corporations). This article studies the interaction...
Optimal Insurance with Nonseparable Background Risk
ABSTRACT The theory of optimal insurance with noninsurable background risk has previously been examined under the assumption that the background risk and insurable loss random variables are additively separable within the agent's utility function....
Pension Reform in Latin America and Its Lessons for International Policymakers
Pension Reform in Latin America and Its Lessons for International Policymakers, by Tapen Sinha, 2000, Norwell, Mass.: Kluwer Academic Publishers Reviewer: Ian Webb, International Insurance Foundation, Washington, DC. Tapen Sinha, professor in the Department...
Rental Car Company Insurance Is Primary Liability Coverage; UIM Coverage Not Forfeited by Disclaimer in Company Brochure; Written Waiver Is Required to Waive UIM Coverage
RENTAL CAR COMPANY INSURANCE IS PRIMARY LIABILITY COVERAGE; UIM COVERAGE NOT FORFEITED BY DISCLAIMER IN COMPANY BROCHURE; WRITTEN WAIVER Is REQUIRED To WAIVE UIM COVERAGE Diaz v. National Car Rental Systems, Inc., 17 P.3d 603 (Wash. 2001). In yet another...
Rental Car Company Insurance Is Primary Liability Coverage; UMI Coverage Not Forfeited by Disclaimer in Company Brochure; Written Waiver Is Required to Waive UIM Coverage. (Recent Court Decisions)
Diaz v. National Car Rental Systems, Inc., 17 P.3d 603 (Wash. 2001). In yet another UIM auto insurance case arising in the state of Washington, the Washington Supreme Court found that the UIM coverage component of insurance sold by a rental car...
Risk Transformations, Deductibles, and Policy Limits
ABSTRACT Rothschild and Stiglitz (1970, 1971) pioneered the study of how an increase in risk affects the demand for a risky asset. Gollier (1995) first identified a necessary and sufficient condition for unambiguous comparative statics for demand...
Weather and Climate Extremes: Changes, Variations, and a Perspective from the Insurance Industry
Weather and Climate Extremes: Changes, Variations, and a Perspective from the Insurance Industry, edited by Thomas R. Karl, Neville Nicholls, and Anver Ghazi, 1999, Norwell, Mass.: Kluwer Academic Publishers Reviewer: Franklin W. Nutter, Reinsurance...
Which Shape for the Cost Curve of Risk?
ABSTRACT It is often suggested that the larger the size of risk, the larger our willingness to pay (WTP) for a given reduction of this risk. The authors show that this is not true in general in the expected utility model. The authors examine under...