New Ideas in Insurance

Virtual Speaker Series

For the fourth year, the Insurance Law Center at the UConn School of Law offers a semester-long series of talks covering new ideas in insurance. Insurance shapes—often decisively—many aspects of our lives, from limiting police misconduct to incentivizing better driving, from regulating self-driving cars to influencing the delivery and pricing of health care. Some of the world’s leading experts from the academy, the bar and the world of insurance regulators will speak about current developments in their fields and speculate about what the future will look like. These fascinating and important conversations are being recorded and will be available to the public.

Fall 2023

Liran Einav

Selection & Welfare in Insurance Markets

September 7, 2023, 4 – 5 p.m.
Liran Einav, Economics, Stanford University
Insurance markets are frequently subject to pressures from selection–insurance purchasers are not a random sample of all potential customers. Rather, those who want/need insurance the most are often the riskiest and thus the highest-cost to insure; those who are least likely to purchase insurance are often the best risks and the cheapest to insure. Under these conditions, Supply and Demand–the mainstay of traditional economic analysis–are no longer independent, because any individual’s decision to buy insurance changes the riskiness of the insurance pool as a whole, and hence the insurer’s cost of supplying it. Professor Einav and co-authors have developed a compelling and intuitive framework for evaluating the complex welfare implications of selection, and this talk will explain his theoretical insights and summarize some recent empirical work that puts them to use in evaluating real-world insurance markets.

Recommended Reading:
(1) For a straightforward introduction to the basic framework: L. Einav & A. Finkelstein, Selection in Insurance Markets: Theory and Empirics in Pictures, 25 J. Econ. Perspectives 115 (2011)
(2) For a survey of recent empirical work using the framework: L. Einav & A. Finkelstein, Empirical Analysis of Selection and Welfare in Insurance Markets: A Self-Indulgent Survey, Geneva Risk & Insurance Review (2023)
(3) For a popular account of selection in insurance markets and the complex welfare problems it creates, L. Einav, A. Finkelstein & R. Fisman, Risky Business (2023).

>> Watch the Video

Jay Feinman

Improving the Market for Homeowner’s Insurance

September 21, 2023, 4 – 5 p.m.
Jay Feinman, Rutgers Law School
Effective markets require comparison shopping, which enables competition. But comparison of insurance products is virtually impossible because insurers do not make policies readily available, and consumers would have a hard time reading and understanding them if they did. In this talk, Professor Feinman will describe two potential solutions to this problem. The “Homeowners Insurance Coverage Summary” provides a template for an accessible summary of key terms, following the example of the Affordable Care Act’s Summary of Benefits and Coverage. “RU InsureScore” gives a Consumer Reports-type ranking, rating each company’s policy on a 100-point scale and rating the policy overall and its key components on a five-star scale, accompanied by brief comments. Professor Feinman will describe the development and contents of the project, including its methodology, presentation, aims, and will explore recommendations for future action by state insurance regulators.

Recommended Reading:
J. M. Feinman, Improving the Market for Homeowners Insurance: The Homeowners Insurance Coverage Summary and RU InsureScore

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Deborah Widiss

Privatizing Family Leave Policy: Assessing the New Opt-in Insurance Model

October 5, 2023, 4 – 5 p.m.
Deborah Widiss, Indiana University
Federal law fails to guarantee new parents or family caregivers paid time off from work. A growing number of blue-leaning states have addressed this gap by enacting comprehensive, paid family and medical leave laws, typically funded by a small payroll tax. A new—and quite different—approach is expanding rapidly in red-leaning states: authorization of commercial “Family Leave Insurance” to be marketed to employers. In other words, this is an opt-in privatized approach to family leave policy, packaging family leave with group short-term disability policies. However, only about 40% of American workers, and just 22% of low-wage workers, receive short-term disability benefits from their employers—and most policies replace only 50-60% of regular wages. By contrast, states that have enacted paid leave laws funded by a payroll tax typically cover virtually all workers, and most replace 80-95% of regular wages (up to a cap). The talk suggests provisions that would help opt-in policies actually meet the needs of new parents and family caregivers. It also explores potential adverse selection challenges that may arise under an opt-in approach. Authorization of opt-in insurance is better than nothing, but it is likely that both workers and businesses are better served by comprehensive paid leave laws.

Recommended Reading:
D. A. Widiss, Privatizing Family Leave Policy: Assessing the New Opt-in Insurance Model (May 24, 2023). 55 Seton Hall Law Review 1543 (2023), Indiana Legal Studies Research Paper No. 506.

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Rachel Friedman

POSTPONED: Risk, Insurance, and the Welfare State

October 19, 2023, 4 – 5 p.m.
Rachel Friedman, Tel Aviv University
At the core of the modern welfare state is the institution of social insurance, which provides event-conditioned benefits through a publicly orchestrated system of contributions and distribution. Tracing an intellectual history of the practice from the time of the French Revolution through the present, this talk offers an account of how and why social insurance became one of the central policy tools of wealthy democracies. This history reveals that the way in which risk is conceived and calculated has important consequences for the design of social policy. It also shows that the capacity of social insurance to accommodate a plurality of normative principles and aims helps to account for its prominence and political resilience as an institution.

Recommended Reading:
Professor Friedman’s book, Probable Justice: Risk, Insurance, and the Welfare State (Chicago: 2020) is available for those interested in reading further.

Shauhin Talesh

Insuring Cyber Insecurity: How Cyber Insurance Undermines Cybersecurity Among Businesses

November 2, 2023, 4 – 5 p.m.
Shauhin Talesh, University of California, Irvine
Cyber risks–loss exposure associated with the use of electronic equipment, computers, information technology, and virtual reality–are among the biggest threats facing businesses and consumers. Despite these threats, prevailing research suggests that private organizations are not significantly changing their behavior in response. Although many organizations do have formal cybersecurity policies in place, the majority believe they are insufficiently prepared for a data breach, have not devoted adequate money, training, and resources to protect consumers’ electronic and paper-based information from data breaches, and fail to perform adequate risk assessments. Drawing on empirical observations over the past 5 years, this talk offers an explanation for why insurers who manage cybersecurity and privacy law compliance among organizations have not been more successful in curtailing breaches. The analysis draws on Talesh’s “new institutional theory of insurance,” which explains how insurers shape the content and meaning of law among organizations that purchase insurance. In response to vague and fragmented privacy laws and a lack of strong government oversight, insurers offer cyber insurance and a series of risk-management services to their customers. These services convey legitimacy to the public and to insureds, but fall short of improving the robustness of organizations, rendering them largely symbolic. Cyber insurers and managed security companies have flooded the market with high-level technical tools that they claim mitigate risk; but all they’ve really accomplished is to institutionalize a norm that policyholders need these tools to avoid cybersecurity incidents. Federal and state regulators and industry-based rating agencies have deferred to cyber insurers, without evidence that these tools actually improve security.

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Alon Rubinstein

Behavioral Professionals: Evidence from the Commercial Auto Insurance Industry

November 16, 2023, 4 – 5 p.m.
Alon Rubinstein, Ph.D. Candidate in Economics, University of California, Berkeley
A key insight from the economics of selection markets is that competition disciplines sellers to customize coverage and premiums optimally. But is this the case? Using data from one of the largest Israeli commercial auto insurance providers, an affiliate of a multinational insurance company, Alon Rubinstein finds there is too little adjustment in the “intensive margin” (pricing). Premiums barely change with expected costs as projected by pre-determined factors (vehicle age) and signals (claims history). At the same time, there is too much adjustment in the extensive margin (acceptance/rejection of the customer), with an excessive denial of insurance in response to recent claims. Using unique grading documents, Rubinstein integrates the insurer’s subjective risk assessment into the study of insurance markets. Rubinstein finds that the insurer’s risk assessment outweighs recent claims and misvalues vehicle age. Structural model estimates suggest that insurers enjoy incumbency advantages over their own customers, and clients are rationally inattentive to competitors’ pricing unless they are faced with a price increase. Both of these channels allow sub-optimal insurer behavior to persist. Finally, Rubinstein finds that supply-side behavioral frictions, which result in excessive denial, mainly harm disadvantaged customers—single-fleet clients of old vehicles—and diminish with the client’s fleet size.

Recommended Reading:
A. Rubinstein, Behavioral Professionals: Evidence from the Commercial Auto Insurance Industry, February 15, 2023.

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Mallory Hope

Transatlantic Slave Traders’ Insurance Strategies: Sources and Challenges

November 30, 2023, 4 – 5 p.m.
Mallory Hope, Postdoctoral Fellow, Harvard Center for History and Economics
Some of most fascinating scholarship on the transatlantic slave trade in recent years has explored the trade’s demand side. To ensure the success of their operations, European slave traders had to make a close study of changing consumer tastes in the African ports they targeted and procure an attractive variety of products from Brazilian tobacco to Indian textiles. Slave traders’ tactics for mitigating risk, however, remain largely in the dark. What proportion of slave-trading ships were insured? What special terms, if any, were included in slave insurance contracts? What premiums were charged on these ships and their human cargoes, and how did the rates compare with insurance on vessels and cargoes in other lines of trade? Were slave-trading voyages customarily insured in certain markets, such as London? In her presentation, Mallory Hope lays out the types of historical sources that can be used to respond to these questions, along with the methodological challenges they present, and Hope will begin to compare underwriters’ and slave traders’ practices on the Continent and in the British Atlantic world.

Recommended Reading:
M. Hope, Risk and Uncertainty in France’s Atlantic Slave Trade, __ Int’l J. Maritime Hist. 1 (2023).

Spring 2023

Spring 2023

Elizabeth Anderson

Historical Origins of the Debate Between Individual and Social Insurance

January 26, 2023, 4 – 5 p.m.
Elizabeth Anderson, Philosophy, University of Michigan
Should protections for old age and disability be based on individual savings or social insurance? This disagreement can be traced to rival plans advanced in the late 18th century by Joseph Priestley (famous chemist, Unitarian minister, and political economist) and Thomas Paine (participant in the American and French Revolutions). This presentation shows how their proposals originated from different interpretations of the Protestant work ethic, which continues to influence current debates.

Recommended Reading:
(1) Elizabeth Anderson, Hijacked: How Neoliberalism Turned the Work Ethic against Workers, and How Workers Can Take it Back, (Forthcoming, Cambridge University Press)
(2) Elizabeth Anderson, “Common Property,” Boston Review (July 25, 2016)

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Katherine R.H. Wagner

Adaptation and Adverse Selection in Markets for Natural Disaster Insurance

February 9, 2023, 4 – 5 p.m.
Katherine R.H. Wagner, Economics, University of British Columbia
This talk discusses demand for flood insurance and the implications for the welfare effects of currently proposed reforms to this market in the United States. Individuals’ willingness to pay for such insurance is remarkably low: even in high-risk flood zones, fewer than 60 percent of homeowners purchase flood insurance, despite premiums that are substantially better than actuarially-fair. The decision to purchase flood insurance depends on observable differences in adaptation, but does not seem to be based on private information about risk. Together, these findings suggest that policymakers may underestimate the welfare costs from current reform efforts to implement actuarially fair premiums.

Recommended Reading:
(1) https://www.aeaweb.org/articles?id=10.1257/pol.20200378

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Tom Baker
Anya Shortland

Binary Stars: How Crime Shapes Insurance and Insurance Shapes Crime

February 23, 2023, 4 – 5 p.m.
Tom Baker, University of Pennsylvania School of Law
Anja Shortland, King’s College London

Crime creates demand for insurance but supplying insurance may promote crime. The authors conceptualize insurance and crime as binary stars, co-evolving as each innovates. They examine five case studies: auto theft, art theft, kidnap and hijack for ransom, ransomware, and payment card fraud. They find insurers engage with insureds and third parties to reduce criminal opportunities, limit damage, salvage stolen property, cap criminal profits, and increase the risk of detection. “Insurance as crime governance” erects barriers to opportunistic crime, engages in strategic interaction with organized crime, tolerates crime if prevention is too costly, and avoids covering non-profit-motivated crimes.

Recommended Reading:
(1) https://drive.google.com/file/d/1XCrCmXMxbw-dAgrnABkzEuqYM4ZFe1XO/view?usp=sharing

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Omri Ben-Shahar

The Case for Usage Based Insurance

March 9, 2023, 4 – 5 p.m.
Omri Ben-Shahar, University of Chicago Law School
Telematic devices installed in cars offer significant welfare gains via Usage Based Insurance, which calibrates premiums to an insured driver’s risky behavior. Sophisticated empirical work robustly reveals that UBI generates robust gains in safety (a roughly 30 to 50 percent reduction in fatal accidents), and lower premiums. Yet there is a strong undercurrent of hostility to telematics on the part of regulators. This talk reviews the substantial safety improvements that UBI makes available, and evaluates the equity, privacy and transparency concerns that may accompany the technology. It concludes that the benefits significantly outweigh the costs, and that regulatory hostility is therefore unwarranted, although some regulation is certainly appropriate.

Recommended Reading:
Exploring the Resistance to Data Technology: The Debate over Tracking in Usage-Based Insurance

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Guido Rossi

How to Regulate a New Insurance Market in Early Modern Europe? The Case of 16th-Century London

March 23, 2023, 4 – 5 p.m.
Guido Rossi, School of Law, University of Edinburgh
The rise of a local insurance market in sixteenth-century London was accompanied by a number of problems, both legal and institutional. Most uncommonly for England, the solution devised by the authorities was to write an insurance code, which happened to be the most advanced and sophisticated piece of legislation on insurance in sixteenth-century Europe.

Recommended Reading:
The Booke of Order of Assurances: A Civil Law Code in 16th Century London

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Sangmin Oh

Social Inflation

April 6, 2023, 4 – 5 p.m.
Sangmin Oh, University of Chicago, Booth School of Business
Broadly interpreted, social inflation refers to shifts in the insurer’s loss distribution due to factors such as large jury awards and broader definitions of liability. This talk reports on an empirical study that uses novel data to show that social inflation poses a meaningful source of aggregate risk to the insurance sector. In particular, it finds that the price impact of social inflation is greater in regions with higher legal exposure, greater for insurers that are more financially constrained, and is economically significant even for insurers not directly affected by verdicts and settlements. An accompanying model shows that the effect persists through two channels: the increase in marginal cost of insurance and the interaction of increased uncertainty with capital regulation.

Recommended Reading:
Social Inflation (October 5, 2022).

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Chris Robertson
Wendy Epstein

Can Moral Framing Drive Insurance Enrollment in the US?

April 20, 2023, 4 – 5 p.m.
Chris Robertson, Boston University School of Law
Wendy Epstein, DePaul University College of Law

Policies to encourage health insurance uptake have focused on consumers’ economic self-interest, attempting to show that insurance is a good deal or to sweeten the deal with subsidies or penalties. Still, some consumers see insurance as a bad deal, either because they rationally exploit private risk information or irrationally misperceive the value due to cognitive biases. As a result, about 30 million Americans lack coverage, including many who could afford it. Might there be other ways to promote the takeup of health insurance? Many citizens view health insurance through a moral lens, and our speakers report on experimental findings suggesting that moral framing (pitching insurance as helping others, helping community, or taking responsibility) could drive millions of additional Americans to shop for health insurance.

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Fall 2022
Robin Pearson

Delusions of Competence: The Near-Death of Lloyd’s of London, 1970-2002

September 8, 2022, 4 – 5 p.m.
Robin Pearson, Professor of Economic History, University of Hull (UK)
System collapse is less common in insurance than in the history of other financial institutions. One exception was the crisis at the Lloyd’s insurance market in the late twentieth century. Hitherto, explanations of the crisis have focused on the effects of catastrophic losses and poor governance, but this talk argues that multiple delusions of competence among internal and external players were also at work.
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Robert Schindler
Matthew S. Isaac

Consumers’ Other-Than-Rational Motives for Buying Insurance

September 22, 2022, 4 – 5 p.m.
Robert Schindler, Rutgers University Business School
Mathew S. Isaac, Seattle University Business School
Insurance may often be purchased for other-than-rational motives. This talk reviews the speakers’ recently published experimental evidence for one such nonrational motive, the feeling that having insurance will cause the insured mishap to be less likely to occur. They also discuss the likely presence of two additional types of nonrational motives for buying insurance, and offer some practical implications.
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Allison Hoffman

The Changing Nature of Job-Based Health Insurance

October 6, 2022, 4 – 5 p.m.
Allison Hoffman, University of Pennsylvania Law School
Health insurance in the U.S. has largely been tied to work since the mid-20th century, but they may become less connected in the future. Job-based coverage has been weakening in many ways. The COVID-19 pandemic further exposed problems with health insurance being tied to work. This talk summarizes the history of health insurance, why job-based coverage is faltering, and how health insurance could and should evolve.
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John Goldberg
Benjamin Zipursky

Tort Law and the Role of Insurance

October 20, 2022, 4 – 5 p.m.
John Goldberg, Harvard Law School
Benjamin Zipursky, Fordham Law School
John Goldberg and Benjamin Zipursky, the two most-cited torts scholars in the United States today, join us to discuss their influential ‘civil recourse’ theory of tort law, recently laid out in their book Recognizing Wrongs (2020). The webinar will address how their account – which focuses mainly on the ‘victim’ and the ‘wrongdoer’ – can explain the pervasive and crucial presence of liability insurance in the tort system. It will also consider questions such as these: Is a morally inflected interpretation of tort law applicable to today’s world, in which settlement is the rule and adjudication to judgment the exception? What does contemporary tort theory have to say about the validity of cost-spreading rationales and mass tort litigation? When, if ever, should no-fault or other insurance mechanisms replace tort law as a means of dealing with the accidents characteristic of our modern, hi-tech world?
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Daniel Sullivan
Seth Schafler

J.P. Morgan Securities Inc. v. Vigilant Ins. Co. and the Nature of Insurance Coverage

November 3, 2022, 4 – 5 p.m.
Daniel Sullivan, Holwell Shuster & Goldberg
Seth Schafler, Covington & Burling
Two of the chief litigators involved in one of the most closely-watched insurance law cases in recent years, J.P. Morgan Securities Inc. v. Vigilant Insurance Co., join us to discuss the many interesting questions it raised. The case, recently decided by the New York Court of Appeals, asked whether a $140 million “disgorgement” payment to the SEC for alleged illegal trading practices was a covered loss under a policy that provided coverage for “wrongful acts” but not for “fines and penalties imposed by law.” The case raised some profound questions, including: What types of losses (e.g., intentional harm, punitive damages, etc.) are uninsurable as a matter of public policy? To what degree should labels like “penalty” or “disgorgement,” when used in a non-insurance context, be allowed to determine coverage under an insurance policy that uses similar terms?  (The Court of Appeals opinion is available at https://www.nycourts.gov/CTAPPS/Decisions/2021/Nov21/61opn21-Decision.pdf)
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Mark Egan

Conflicting Interests and the Effect of Fiduciary Duty — Evidence from Variable Annuities

November 17, 2022, 4 – 5 p.m.
Mark Egan, Harvard Business School
Variable annuities are popular retirement products, with over $2 trillion in assets in the United States. Brokers receive substantial commissions from insurers for selling these products, and the commissions are higher for annuities with higher expenses and more ex-post complaints. But variable annuity sales are roughly four times as sensitive to brokers’ financial interests as to investors’. The Department of Labor’s 2016 fiduciary rule led to a 52% drop in high expense annuities, and on conservative assumptions, it increased investor welfare.
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Mark Pauly

Externalities in the Wildland

December 1, 2022, 4 – 5 p.m.
Mark Pauly, Wharton School, University of Pennsylvania
This presentation, Externalities in the Wildland – Urban Interface: Private Decisions, Collective Action, and Results from Wildfire Simulation Models for California, addresses the fact that much of the property damage from wildfires occurs when fires spread into built-up areas, the wildland/urban interface. In these areas, fire spreads from house to house, as embers from one burning structure ignite neighboring ones. Homeowners can take measures to mitigate the chances that their house will ignite, but in doing so, they tend to ignore the benefits their actions create for their neighbors. The size of this external benefit depends on the assumed process of fire spread, which in turn depends on building density and the effectiveness of mitigation. An empirical model of this externality reveals the degree of underinvestment that individuals will undertake, and the corrective actions (including building code rules and subsidies for insurance premiums on mitigation activities). Because it will rarely be optimal to mitigate all homes, the optimal solution may involve unequal treatment and raise equity issues. Download the working paper.
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Spring 2022
Hannah Farber

How Insurance Shaped the American Founding

January 20, 2022, 4 -5 p.m. ET
Hannah Farber, Columbia University
American maritime insurers used their position at the pinnacle of global trade to shape the new nation. The international information they gathered and the capital they generated enabled them to play central roles in state building and economic development. During the Revolution, they helped the U.S. negotiate foreign loans, sell state debts, and establish a single national bank. Afterward, they increased their influence by lending money to the federal government and to its citizens. By the early nineteenth century, insurers were no longer just risk assessors. Prof. Farber’s new book Underwriters of the United States reveals insurers as nation builders and market makers.
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Dan Schwarcz and Ken Abraham

Not So Fast: The Limits of Regulation by Insurance

January 27, 2022, 4 – 5 p.m. ET
Kenneth Abraham, University of Virginia School of Law
Daniel Schwarcz, University of Minnesota Law School

Insurance law scholars have long believed that insurance does more than just transfer risk: it plays a key role in regulating the conduct of policyholders by creating incentives for risk management and in some cases requiring or forbidding certain behavior. Some have claimed that the power of insurance can be a potent substitute for direct regulation by government. Professors Abraham and Schwarcz argue that the ability of insurance to substitute for governmental regulation is more limited than we have realized.
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Justin Snydor

Why Health Insurance Consumers Make Bad Choices

February 3, 2022, 4 – 5 p.m. ET
Justin Sydnor, University of Wisconsin-Madison School of Business
Empirical evidence shows that for many employers who offer different levels of health insurance coverage (e.g., a high-deductible option alongside a more generous plan), one of the options ends up dominating the other, meaning that one plan is simply worse than the other for all consumers. This seems to occur because employers pass through cost differentials between the employees who opt into low vs. high coverage (typically younger/healthier vs. older/less healthy). Offering different coverage options (without any constraints on how those options are priced to the employees) creates a back-door that permits differential benefits based on health status. This talk explores the empirical and theoretical aspects of consumers choice of health insurance plans, and suggests ways that regulation should be designed to cope with consumers’ cognitive infirmities.
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Casper de Jong

Does the Policyholder Really Know Better? A Reversal of the Basic Assumption of the Theory of Adverse Selection.

February 17, 2022, 4 – 5 p.m. ET
Casper de Jong, retired insurance executive
Adverse selection occurs when insurance purchasers know more about their own riskiness than insurers do, and use that knowledge in deciding how much or what kind of insurance overage to purchase. Theory and much regulatory practice assume that this kind of informational asymmetry (favoring policyholders) is universal; but Mr. de Jong challenges this basic assumption, arguing instead that insurers typically know more about their policyholders’ riskiness than the policyholders themselves do. This talk explores the causes and consequences of this informational reversal.
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Kyle Logue

The Case for Banning (and Mandating) Ransomware Insurance

February 24, 2022, 4 – 5 p.m. ET
Kyle Logue, University of Michigan Law School
Cyber-ransom poses difficult policy questions. On the one hand, the presence of insurance may actually increase the profitability of ransom-ware attacks and create incentives for more of them. On the other, properly constructed and well-regulated insurance offers a variety of pre- and post-breach services that can reduce the likelihood and severity of ransomware attacks. This talk discusses how best to structure insurance regulation to handle these difficult tradeoffs.
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Ronen Avraham

The Dark Side of Insurance

March 3, 2022, 4 – 5 p.m. ET
Ronen Avraham,  Tel Aviv University Faculty of Law
Insurance has well-known and important benefits; but it has an overlooked dark side as well. Insurers sometimes deny coverage unjustly, shifting short-term risks to insureds (or their victims) rather than reducing them. Worse, insurers might also act to increase long-term risks: They may provide suboptimal incentives for insureds to take care, as well as present wrongdoers with incentives to target insureds as victims. Further, insurers may block technological progress and lobby for inefficient regulation, even at the expense of more long-term risks to their insureds and society. Insurers may even invest in risky products and activities to increase the demand for insurance coverage against these very same risks. Wise policy requires taking account of the dark side of insurance.
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Insurance Law and the Firearms Industry

March 10, 2022, 4 – 5 p.m. ET
Peter Kornman, retired attorney, Davis, Polk & Wardwell
Federal legislation known as the Protection of Lawful Commerce in Arms Act (PLCAA) poses significant limits on the ability of state governments to regulate what would otherwise be the tortious behavior of arms manufacturers. This talk explores how state governments can operate at the intersection of insurance regulation, McCarran/Ferguson, and the PLCAA to regulate gun manufacturer liability.

Geoffrey Clark

The Moral Economy of the Insuring Crowd

March 24, 2022, 4 – 5 p.m. ET
Geoffrey Clark, State University of New York at Potsdam
Insurance is commonly seen as a scientific application of statistical collection and probabilistic analysis to infer the value of risks. Viewed historically, however, insurance arose in a wider philosophical, religious, and political matrix in which claims to scientific knowledge and precision were just one, and not even the most important, component. This talk will survey how the origins of the life insurance business offer clues about how insurance was understood in its formative decades and how many people may understand the way insurance operates today.
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Jessica Altman, Andrew Mais, My Chi To

Race and Insurance

March 31, 2022, 4 – 5 p.m. ET
Jessica Altman, Former Insurance Commissioner for the Commonwealth of Pennsylvania
Andrew Mais, Commissioner of the Connecticut Insurance Department
My Chi To, Executive Deputy Superintendent of Insurance at New York State Department of Financial Services
We present a panel discussion in which three distinguished regulators share their views on the difficult questions posed by race-based discrimination in insurance markets.

Peter Siegelman, Gideon Parchomovsky

Third Party Moral Hazard

April 7, 2022, 4 – 5 p.m. ET
Peter Siegelman, University of Connecticut School of Law
Gideon Parchomovsky, University of Pennsylvania Law School & Hebrew University Faculty of Law
Conventional moral hazard occurs when the transfer of risk from policyholder to insurer leads the former to reduce its level of precautions. We surface a related phenomenon: insurance can lead third parties (who are outside of the insurance contract) to increase loss- or claims-causing behavior. Such negative externalities from insurance are widespread, and the authors offer an explanation for their origins and discuss some policy implications.
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Carolyn Kousky

Inclusive (Flood) Insurance

April 14, 2022, 4 – 5 p.m. ET
Carolyn Kousky, University of Pennsylvania
The mid-Atlantic region of the United States is experiencing accelerated rates of sea level rise, increasing flooding. And the problem is worst for lower-income residents. Unfortunately, these same residents struggle with access to the needed financial resources to recover from floods. Such recovery is a necessary condition for broader urban disaster resilience. Despite this, flood coverage for low and middle-income residents is an under-researched aspect of climate adaptation. This talk reports on ongoing research to promote accessible flood insurance for lower-income communities, with a particular focus on New York City.
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Fall 2021
Michael Abramowizc

Livelihood Insurance

January 21, 2021, 4 -5 p.m.
Michael Abramowizc, George Washington Law School
Nobel Laureate Robert Shiller has argued for livelihood insurance, a financial derivative that would provide compensation when many individuals in a particular occupation suffer losses. This talk will explore why livelihood insurance did not emerge in time to protect workers in the last pandemic and what the government can do before the next crisis to protect workers in vulnerable professions.
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Ray Farmer

The Year We Got: Covid, 2020 and the NAIC

February 4, 2021, 4 -5 p.m.
Ray Farmer, South Carolina Department of Insurance
South Carolina Director of Insurance Ray Farmer became the NAIC president in January 2020, expecting the major issues would include the long-term care insurance market, climate and resiliency, continued uncertainties with the ACA and access to affordable health insurance, international regulatory cooperation, and the growing role of Big Data and predictive analytics.  Then the pandemic arrived, demanding immediate regulatory attention and leadership, and a spring and summer of protests moved race and racism to the forefront.  Several months after his term, Director Farmer will discuss 2020 and the NAIC.
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Daniel Schwarcz

The Rules of Medical Necessity

February 11, 2021, 4 -5 p.m.
Daniel Schwarcz, University of Minnesota Law School
Historically, health insurance contracts have required coverage of virtually all “medically necessary,” “non-experimental,” care, with these terms being defined through broad standards. In recent years, however, health insurers’ contracts and practices have moved towards a more rules-based approach for defining covered health care. This talk explores how this shift undermines the effectiveness of traditional legal tools designed to constrain the risk of health insurers overreaching in coverage determinations, such as litigation, external review, internal review, and coverage mandates.
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Shoshana Vasserman

Buying Data from Consumers

The Impact of Monitoring Programs in U.S. Auto Insurance
February 18, 2021, 4 -5 p.m.
Shoshana Vasserman, Stanford Business School
What happens when insurers gain better information about the riskiness of their customers? The question is of tremendous importance as new technologies allow insurers to monitor customers’ behavior and use that information to price their product. But little is known about the equilibrium effects of this kind of information–how is it priced, who agrees to provide it, what effect it has on competition among insurers, and how it affects overall welfare. This talk offers an empirical perspective on these issues.
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Anya Prince

Genetic Non-Discrimination

February 25, 2021, 4 -5 p.m.
Anya Prince, University of Iowa Law School
Florida has recently passed legislation that bars life (and long-term care and disability) insurers from using genetic information in underwriting. This talk explores the intricacies of the legislation and discusses how effective it is likely to be.
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John Rappaport

How Private Insurers Regulate Public Police

March 11, 2021, 4 -5 p.m.
John Rappaport, University of Chicago Law School
Can insurance can be used to regulate police misconduct? How effective has it been in doing so, and why might it be an effective option going forward? This talk addresses these and related issues at the intersection of insurance and civil rights.
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Tom Baker

Long Term Care Insurance

March 25, 2021, 4 -5 p.m.
Tom Baker, University of Pennsylvania Carey Law School
Long term care insurance is an inherently risky product, since the evolution of medical costs is subject to great uncertainty and since socio-legal risk is highly correlated across insureds. This talk explores how insurers manage such risks.
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Patricia Born

Liability Claim Evaluation, Big Data, and the Persistence of Uncertainty

April 1, 2021, 4 -5 p.m.
Patricia Born, Florida State University
Outcomes of medical malpractice lawsuits reflect a great deal of uncertainty for insurers, despite their access to historical claims experience and evolving sources of “Big Data.” Variations in how people recover from certain types of injuries and how juries perceive fault, for example, can have large effects on claim payout variability. This presentation explores the role of injury types, juries, and other factors that may explain why an insurer’s initial assessment of how a claim will evolve is often off the mark.

Bill Goddard

InsurTech Adventures in Insurance Regulation: Windows, Walls and Trap Doors.

April 8, 2021, 4 -5 p.m.
Bill Goddard, Electromagnetic Advisors and UConn School of Law
What happens when the world of technology meets the world of insurance? This talk offers an insider’s account of how we got where we are, and where we’re going from here.

Asaf Lubin

Insuring an Evolving Mobility Ecosystem: From Mustang Sally to Waymo One

April 15, 2021, 4 -5 p.m.
Asaf Lubin, University of Indiana Law School
It is widely believed that the adoption of autonomous vehicles will lead to a continual decline in the frequency of accidents and a shift towards products liability that will bring an end to automobile insurance as we know it. This presentation will make the case that automobile insurance is not going anywhere, though insurers, regulators, and manufacturers will need to adapt to a changing mobility environment.

John Cogan

Gender in Health Insurance Pricing

April 22, 2021, 4 -5 p.m.
John Cogan, University of Connecticut School of Law
Gender rating—charging women higher premiums than men—is justified on the basis of actuarial fairness (each gender bears the cost of its own risk and does not subsidize the other). This reasoning ignores an underlying theoretical flaw in insurance classification theory: no matter what variables an insurer uses to classify risks, there will always be cross-subsidies and risk-based unfairness. Thus, I argue that using gender as a rating variable is a policy choice by insurers, not an actuarial or economic necessity.
Watch the video.

Susan Donegan

Workers Compensation, COVID-19 and Emerging Issues

April 29, 2021, 4 -5 p.m.
Susan Donegan, National Council on Compensation Insurance
Workers Compensation is the nation’s oldest social insurance system and while it has adapted as the workplace evolves, its core components of payment for medical care and income replacement due to work-place injuries and disease remain the same.  With COVID-19, the importance of these benefits, their cost, and the difficulties in demonstrating causality between infection and the workplace, has led states to review their workers compensation systems and consider whether to rebalance some of its central components.