Institut für Risikomanagement und Versicherung




Insurance Economics

Prof. Dr. Andreas Richter; Michael Hanselmann


This course deals with core concepts of the theory of insurance demand. After a review of essentials of decision theory the optimal design of insurance products is addressed from an information economics point of view. Optimal risk sharing in a complete information setting is discussed as the benchmark case. The main emphasis is placed on principal agent problems due to superior knowledge of the insured. In particular the class covers adverse selection, moral hazard and insurance fraud which heavily affect almost any real-life insurance market. Implications for product design as well as the interaction between insurance and other markets are analyzed.

Organizational Issues


  • This is a Master-level class. Basic knowledge of decision theory, finance, and economics is necessary.
  • No written application is required.
  • Blocked course in the second half of the semster: June 8th through July 3rd, 2015 (see schedule below).
  • Please find further information in the syllabus.

Main Objectives

  • To obtain an overview of essential concepts in insurance economics.
  • To understand the implications of asymmetric information for insurance contracting.
  • To be able to explain and evaluate real-life insurance product design from an economic point of view.


June 8th 10am - 2pm Modules I & II Lehrturm W 201
June 10th 2pm - 6pm Problem sets 1 & 2 Lehrturm W 101
June 12th 10am - 2pm Module II Lehrturm W 101
June 15th 10am - 2pm Module III Lehrturm W 201
June 17th 2pm - 6pm Problem sets 3 & 4 Lehrturm W 101
June 19th 10am - 2pm Modules III & IV Lehrturm W 101
June 22nd 10am - 2pm Module IV & V Lehrturm W 201
June 24th 2pm - 6pm Problem sets 5 & 6 Lehrturm W 101
June 26th 10am - 2pm Problem set 6 & Case Study Genetic Testing Lehrturm W 101
June 29th 10am - 2pm Problem sets 7 & 8 Lehrturm W 201
July 3rd 10am - 2pm Module VI & Mock Exam Lehrturm W 101


  • 2-hour written exam
  • To take the exam, registration via the LSF-Portal is necessary. Students that cannot register via this portal need to send an e-mail to
  • 6 ECTS (MSc)
  • Date: Friday, July 17th, 11 am – 1 pm
  • Room: M 218, Hauptgebäude