The Effect of Regulation on Insurance Pricing: The Case of Germany

36 Pages Posted: 24 Feb 2012

See all articles by Thomas Berry-Stölzle

Thomas Berry-Stölzle

University of Iowa - Department of Finance

Patricia Born

Florida State University

Date Written: March 2012

Abstract

This article analyzes the impact of policy form regulation on the unit price of insurance and determinants of premium changes using the 1994 deregulation of the German property–liability market as a natural experiment. Our result show that policy form regulation did not increase prices above competitive levels. Factors influencing premium changes are significantly different for the two time periods, pre‐ and post‐deregulation, indicating that regulation affects insurance pricing. Focusing on highly competitive lines after deregulation, we find a significant price decrease, and this decrease is offset by higher prices in the remaining other lines.

Suggested Citation

Berry-Stölzle, Thomas and Born, Patricia, The Effect of Regulation on Insurance Pricing: The Case of Germany (March 2012). Journal of Risk and Insurance, Vol. 79, Issue 1, pp. 129-164, 2012, Available at SSRN: https://ssrn.com/abstract=2010347 or http://dx.doi.org/10.1111/j.1539-6975.2010.01398.x

Thomas Berry-Stölzle (Contact Author)

University of Iowa - Department of Finance ( email )

Iowa City, IA 52242-1000
United States

Patricia Born

Florida State University ( email )

College of Business
Tallahassee, FL 32306
United States
8506647884 (Phone)

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