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Durham University

Research & business

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Publication details

Hansen, J.V., Jacobsen, R.H. & Lau, M.I. (2016). Willingness to pay for insurance in Denmark. Journal of risk and insurance 83(1): 49-76.

Author(s) from Durham


We estimate how much Danish households are willing to pay for auto, home, and house insurance. We use a unique combination of claims data from a large Danish insurance company, measures of individual risk attitudes and discount rates from a field experiment with a representative sample of the adult Danish population, and information on household income and wealth from registers at Statistics Denmark. The results show that the willingness to pay is marginally higher than the actuarially fair value under expected utility theory, but significantly higher under rank-dependent utility theory, and up to 600 percent higher than the actuarially fair value.