The Optimal Insurance Contract Analysis In Asymmetric Information

The wealth development of the insurance industry as one of the backbone industries of modern finance means great significance to economic development. Wing the development of insurance industries, the fraud behavior of policyholders due to asymmetric information becomes the main obstacle to the wealth development of the insurance industries and one of the business risks of insurers. In light of asymmetric information in insurance market, this thesis combines the related knowledge of asymmetric information theory, utility theory, agency theory, game of theory to analyze the optimal insurance contract in asymmetric information.(1) This thesis mainly introduces related theoretical knowledge background about insurance fraud in the beginning, and gives the basic assumptions on the risk attitude of insurers and the insured. On this assumption this thesis systematically studies the insurance fraud of policyholders.(2) This paper considers the design of balanced policies of the insure under the condition of the information symmetry and pure adverse selection when there are only two types of risk insurance applicants in the perfectly competitive insurance market, that is high-risk insurance applicants and low-risk insurance applicants. Insurer gets the optimal insurance contract by establishing the most optimal solution model respectively by maximizing the effectiveness of two types of people and low-risk people. We also compare the effectiveness of the applicants in both cases.(3) This paper mainly uses the agency theory to discuss the optimal balanced policy for the insurer in the condition of the existence of adverse selection and moral hazard. the action of the insured affecting the likelihood of security. Insurer applies incentive mechanism, making the insured to take advanced action for insurers by the form of risk-sharing.(4) This paper use game theory to analyze the moral hazard of policyholders exaggerating losses and get the optimal survey probability of the insurance companies.