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Demand and Selection Effects in Supplemental Health Insurance in Germany

Author

Listed:
  • Renate Lange

    (University of Hohenheim)

  • Jörg Schiller

    (University of Hohenheim)

  • Petra Steinorth

    (St. John’s University)

Abstract

This paper empirically assesses selection effects and determinants of the demand for supplemental health insurance that covers hospital and dental benefits in Germany. Our representative data set provides doctor-diagnosed indicators of the individual’s health status, risk attitude, demand for medical services and insurance purchases in other lines of insurance, as well as rich demographic and socio-economic information. Controlling for a wide range of individual preferences, we find evidence that individuals aged 65 and younger with hospital coverage are sicker than those without. In addition, insurance propensity and income are the most important drivers of the demand for supplemental hospital and dental coverage.

Suggested Citation

  • Renate Lange & Jörg Schiller & Petra Steinorth, 2017. "Demand and Selection Effects in Supplemental Health Insurance in Germany," The Geneva Papers on Risk and Insurance - Issues and Practice, Palgrave Macmillan;The Geneva Association, vol. 42(1), pages 5-30, January.
    • Handle: RePEc:pal:gpprii:v:42:y:2017:i:1:d:10.1057_s41288-016-0023-2
    DOI: 10.1057/s41288-016-0023-2
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    References listed on IDEAS

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    Cited by:

    1. Jan Michael Bauer & Jörg Schiller & Christopher Schreckenberger, 2020. "Heterogeneous selection in the market for private supplemental dental insurance: evidence from Germany," Empirical Economics, Springer, vol. 59(1), pages 205-231, July.
    2. Bonsang, Eric & Costa-Font, Joan, 2022. "Buying control? ‘Locus of control’ and the uptake of supplementary health insurance," Journal of Economic Behavior & Organization, Elsevier, vol. 204(C), pages 476-489.
    3. Lu Li & Andreas Richter & Petra Steinorth, 2023. "Mental health changes and the willingness to take risks," The Geneva Risk and Insurance Review, Palgrave Macmillan;International Association for the Study of Insurance Economics (The Geneva Association), vol. 48(1), pages 31-62, March.
    4. Patricia H. Born & E. Tice Sirmans, 2020. "Restrictive Rating and Adverse Selection in Health Insurance," Journal of Risk & Insurance, The American Risk and Insurance Association, vol. 87(4), pages 919-933, December.
    5. Purcel, Alexandra-Anca & Dragos, Cristian Mihai & Mare, Codruța & Dragos, Simona Laura, 2023. "Voluntary health insurance and out-of-pocket payments in European OECD countries," Economic Modelling, Elsevier, vol. 120(C).

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    More about this item

    Keywords

    supplemental health insurance; asymmetric information; one-sided commitment; insurance demand; German statutory health insurance; insurance propensity;
    All these keywords.

    JEL classification:

    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • G22 - Financial Economics - - Financial Institutions and Services - - - Insurance; Insurance Companies; Actuarial Studies
    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets

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