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Risks 2015, 3(4), 445-454;

Risk Classification Efficiency and the Insurance Market Regulation

Dipartimento di Scienze dell'Economia, Università del Salento, Ecotekne, Via per Monteroni, Lecce 73100, Italy
Academic Editors: Mogens Steffensen and Georges Dionne
Received: 29 June 2015 / Accepted: 21 September 2015 / Published: 25 September 2015
(This article belongs to the Special Issue Information and market efficiency)
Full-Text   |   PDF [340 KB, uploaded 25 September 2015]


Given that the insurance market is characterized by asymmetric information, its efficiency has traditionally been based to a large extent on risk classification. In certain regulations, however, we can find restrictions on these differentiations, primarily the ban on those considered to be “discriminatory”. In 2011, following the European Union Directive 2004/113/EC, the European Court of Justice concluded that any gender-based discrimination was prohibited, meaning that gender equality in the European Union had to be ensured from 21 December 2012. Another restriction was imposed by EU and national competition regulation on the exchange of information considered as anti-competitive behavior. This paper aims to contribute to the recent policy debate in the EU, evaluating the negative economic consequences of these regulatory restrictions in terms of market efficiency. View Full-Text
Keywords: risk classification; asymmetric information; discrimination; adverse selection risk classification; asymmetric information; discrimination; adverse selection
This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited (CC BY 4.0).

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Porrini, D. Risk Classification Efficiency and the Insurance Market Regulation. Risks 2015, 3, 445-454.

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