The Expected Cost of Ruin and Insurance Premiums in Mutual Insurance

Authors

Charles S. Tapiero
Laurent L. Jacque

Document Type

Report

Publication Date

9-1-1987

Abstract

The purpose of this paper is to provide a quantitative definition and assessment of the expected cost of ruin in mutual insurance. In addition, some implications are drawn regarding the actuarially fair premium policyholders may be willing to pay for mutual insurance. A special case is treated, yielding analytical results that allow a comparative static analysis of the effects of ruin on premium payments and an assessment of the cost of ruin-free mutual insurance contracts.

Keywords

Operations research, Insurance, Insurance--Mathematical models, Risk assessment, Insurance premiums, Actuarial science

Publication Title

Technical Memorandums from the Department of Operations, School of Management, Case Western Reserve University

Issue

Technical memorandum no. 604

Rights

This work is in the public domain and may be freely downloaded for personal or academic use

Recommended Citation

Tapiero, Charles S. and Jacque, Laurent L., "The Expected Cost of Ruin and Insurance Premiums in Mutual Insurance" (1987). Research Reports from the Department of Operations. 198.
https://commons.case.edu/wsom-ops-reports/198