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Uninsured by choice? A choice experiment on long term care insurance

Akaichi, Faical, Costa-I-Font, Joan and Frank, Richard (2019) Uninsured by choice? A choice experiment on long term care insurance. Journal of Economic Behavior and Organization. ISSN 0167-2681 (In Press)

[img] Text (Uninsured by Choice? Evidence from a Choice Experiment on Long Term Care Insurance) - Accepted Version
Pending embargo until 1 January 2100.
Available under License Creative Commons Attribution Non-commercial No Derivatives.

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Abstract

We examine evidence from two unique discrete choice experiments (DCE) on long term care insurance and several of its relevant attributes, and more specifically, choices made by 15,298 individuals in the United States with and without insurance. We study the valuation of the following insurance attributes, namely daily insurance benefit, insurance coverage, the compulsory and voluntary nature of the insurance policy design, alongside the costs (insurance premium) and health requirements This paper investigates respondents’ preferences and willingness to pay (WTP) for these care insurance’s attributes using a random parameter logit model, and assess the heterogeneity of choice responses using demographic, socioeconomic and attitudinal motivations to segment response to insurance choices. We find that an increase in the insurance premium by an additional 100US$ would reduce insurance uptake by 1pp. Insurance policy uptake is higher when it provides benefits for the lifetime (the monthly marginal WTP being $178.64), and voluntary (the monthly marginal WTP increases by an extra $74.71) as opposed to universal, and when it forgoes health checks (the monthly marginal WTP increases by an extra 28US$).

Item Type: Article
Additional Information: © 2019 Elsevier B.V
Divisions: Health Policy
Subjects: H Social Sciences > HC Economic History and Conditions
JEL classification: I - Health, Education, and Welfare > I1 - Health > I18 - Government Policy; Regulation; Public Health
Date Deposited: 23 Jul 2019 10:30
Last Modified: 21 Aug 2019 23:08
URI: http://eprints.lse.ac.uk/id/eprint/101215

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