Peer-to-peer multi-risk insurance and mutual aid

Abdikerimova, Samal; Feng, Runhuan

doi:10.1016/j.ejor.2021.09.017

Cited by 39 publications

(14 citation statements)

References 18 publications

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“…proposed in the literature. The interested reader is referred, for example, to Abdikerimova and Feng (2022) for a discussion of altruistic transfer plans and to Charpentier et al (2021) for a study of maximum coverage for nonlinear contracts, for examples in the most recent literature.…”

Section: Discussionmentioning

confidence: 99%

“…P2P insurance systems so revive the ancestral compensation mechanism consisting of using the contributions of the many to balance the misfortunes of the few. See, for example, Abdikerimova and Feng (2022) and the references therein. Such risk-sharing mechanisms are also found in mutual insurance arrangements or partnerships among lawyers, farmers, or physicians, for instance, who form risk pools to protect themselves against professional risks.…”

Section: Introductionmentioning

confidence: 99%

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Risk‐sharing rules and their properties, with applications to peer‐to‐peer insurance

Denuit

Dhaene

Robert

2022

J of Risk & Insurance

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This paper offers a systematic treatment of risksharing rules for insurance losses, based on a list of relevant properties. A number of candidate risksharing rules are considered, including the conditional mean risk-sharing rule proposed in Denuit and Dhaene and the newly introduced quantile risksharing rule. Their compliance with the proposed properties is established. Then, methods for building new risk-sharing rules are discussed. The results derived in this paper are helpful in the development of peer-to-peer insurance (or crowdsurance), as well as to manage contingent risk funds where a given budget is distributed among claimants.

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Section: Discussionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Risk‐sharing rules and their properties, with applications to peer‐to‐peer insurance

Denuit

Dhaene

Robert

2022

J of Risk & Insurance

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“…Based on Pareto optimality, it is concluded that the premium can be selected in a given interval and the buyer and seller should equally distribute the income of risk sharing. Abdikerimova and Feng [1] proposed a variety of P2P models for peers with different needs, so that they can exchange a variety of risks in a fair and transparent actuarial way. In addition, Abdikerimova et al [2] considered the P2P risk sharing in both the dynamic and the static settings.…”

Section: P2p Insurance and Risk Sharingmentioning

confidence: 99%

Optimal design for network mutual aid

Fang²,

Nie³

et al. 2022

Prob. Eng. Inf. Sci.

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Network mutual aid platforms is one of the popular risk-sharing models in recent years, and they have almost 200 million members in China. However, current mutual aid platforms does not satisfy the actuarial rules in either the apportionment method or the pricing principle. Hence, a variety of mutual aid models which enable mutual aid members with different risks to exchange their risks in a transparent and actuarial fair way have been proposed in this paper. Besides, the decision-making frameworks for participants choosing between the mutual aid platform and similar insurance products, or choosing no risk sharing are constructed, respectively. Decisions are made based on the principle of maximizing expected utility. Moreover, the optimization problems of maximizing profit and minimizing risk are constructed, respectively. Through the principle of individual fairness and relative fairness, the problem of adverse selection of the platform can also be reduced. Finally, the actual mutual aid plan is compared with similar insurance products to discuss the advantages of the optimized plan.

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“…Such a collective transfer is possible because of the central limit theorem that guarantees that the relative variability of individual contracts decreases with the number of insured in the pool. Conventional structures are either stock companies (owned by shareholders), and mutual companies, which are owned by policyholders, the later might create some sort of solidarity among policyholders, as discussed for instance in Abdikerimova and Feng [2019]. But in emerging economies, where the insurance sector is neither properly regulated, nor developed, alternatives can be considered to provide risk sharing among agents, that could be either based on small groups (as in tontines) or based on multiple one-to-one reciprocal engagements.…”

Section: Centralized and Decentralized Insurancementioning

confidence: 99%

Collaborative Insurance Sustainability and Network Structure

Charpentier¹,

Kouakou²,

Löwe³

et al. 2021

Preprint

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The peer-to-peer (P2P) economy has been growing with the advent of the Internet, with well known brands such as Uber or Airbnb being examples thereof. In the insurance sector the approach is still in its infancy, but some companies have started to explore P2P-based collaborative insurance products (eg. Lemonade in the U.S. or Inspeer in France). The actuarial literature only recently started to consider those risk sharing mechanisms, as in Denuit and Robert [2020b] or Feng et al. [2021]. In this paper, we describe and analyse such a P2P product, with some reciprocal risk sharing contracts. We consider the case where policyholders still have an insurance contract, but the first self-insurance layer, below the deductible, can be shared with "friends". We study the impact of the shape of the network (through the distribution of degrees) on the risk reduction. We consider also some optimal setting of the reciprocal commitments, and discuss the introduction of contracts with "friends of friends" to mitigate some possible drawbacks of having people without enough connections to exchange risks.

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Peer-to-peer multi-risk insurance and mutual aid

Cited by 39 publications

References 18 publications

Risk‐sharing rules and their properties, with applications to peer‐to‐peer insurance

Risk‐sharing rules and their properties, with applications to peer‐to‐peer insurance

Optimal design for network mutual aid

Collaborative Insurance Sustainability and Network Structure

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