Harin, Alexander
(2011):
*The theorem of existence of the ruptures in probability scale and the basic question of insurance.*

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## Abstract

The theorem of existence of the ruptures in the probability scale was proved in 2010. The theorem is used to analyze and to partially answer to the basic questions of insurance. The question is “To insure or not”. The goal of this paper is to reveal pure mathematical aspects of insurance processes and to analyze these aspects by pure mathematical methods, including application of the theorem. Its most significant result: when uncertainty increases, then taking the theorem into account may reverse insurant’s and insurer’s decisions to the opposite ones.

Item Type: | MPRA Paper |
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Original Title: | The theorem of existence of the ruptures in probability scale and the basic question of insurance |

Language: | English |

Keywords: | insurance; underwriting; probability; uncertainty; dispersion |

Subjects: | G - Financial Economics > G2 - Financial Institutions and Services > G22 - Insurance ; Insurance Companies ; Actuarial Studies C - Mathematical and Quantitative Methods > C0 - General > C02 - Mathematical Methods |

Item ID: | 34780 |

Depositing User: | Alexander Harin |

Date Deposited: | 16 Nov 2011 17:19 |

Last Modified: | 06 Oct 2019 04:35 |

References: | 1. Abramowitz, M. and Stegun, I. eds. (1972), "Handbook of Mathematical Functions with Formulas, Graphs, and Mathematical Tables", New York: Dover Publications, 1972. 2. Cutler, D.M., Finkelstein, A., McGarry, K. (2008), "Preference Heterogeneity and Insurance Markets: Explaining a Puzzle of Insurance," // American Economic Review, v. 98(2), pp. 157-62. 3. Harin, А. (2010-4), "Theorem of existence of ruptures in probability scale. Discrete case" (in Russian) MPRA, 23902. 4. Harin, А. (2010-3), "The theorem of existence of ruptures in the probability scale, as the mathematical basis of the principle of uncertain future" (in Russian) Tenth International Scientific School "Modelling and Analysis of Safety and Risk in complex systems" MASR-2010). 5. Harin, А. (2010-2), "The ruptures in the probability scale and some problems of modelling" (in Russian) Third international conference "Mathematical Modelling of Social and Economical Dynamics" MMSED-2010. 6. Harin, А. (2010-1), "Theorem of existence of ruptures in the probability scale" (in Russian) Financial and Actuarial Mathematics and Eventoconverging Technologies FAMET'2010. 7. Venezian, E. (2006), "The use of spectral analysis in insurance cycle research" // Journal of Risk Finance, 2006, v. 7, № 2, pp. 177-188. 8. Winter, R. (1991), "Solvency Regulation and the Property-Liability "Insurance Cycle" // Economic Inquiry, 1991, v. 29, № 3, pp. 458-71. |

URI: | https://mpra.ub.uni-muenchen.de/id/eprint/34780 |