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Lecture 5 - Insurance: The Archetypal Risk Management Institution

This video was recorded at ECON 252 - Financial Markets. Insurance provides significant risk management to a broad public, and is an essential tool for promoting human welfare. By pooling large numbers of independent or low-correlated risks, insurance providers can minimize overall risk. The risk management is tailored to individual circumstances and reflects centuries of insurance industry experience with real risks and with moral hazard and selection bias issues. Probability theory and statistical tools help to explain how insurance companies use risk pooling to minimize overall risk. Innovation and government regulation have played important roles in the formation and oversight of insurance institutions. Reading assignment: Fabozzi et al. Foundations of Financial Markets and Institutions, chapter 6 Resources: PowerPoint slides from screen - Lecture 5[PDF]

Keywords:: videolectures, ocwc, oec

Disciplines:

Business / Economics

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Material Type:: Presentation
Date Added to MERLOT:: February 10, 2015
Date Modified in MERLOT:: February 10, 2015
Author:: Robert J. Shiller, Department of Economics, Yale University
Submitter:: The Open Education Consortium
Primary Audience:: College General Ed, College Lower Division, College Upper Division
Technical Format:: Video

Mobile Compatibility:: Not specified at this time
Language:: English
Cost Involved:: No
Source Code Available:: No
Creative Commons:: This work is licensed under a Attribution-NonCommercial-NoDerivs 3.0 United States