The course Insurance Economics and the supplementing tutorial impart the fundamentals for the design of insurance contracts with incomplete information. The focus is on the principals of insurance regulation and the different forms of information asymmetries.

First of all, supervisory requirements for insurance companies, especially Solvency II, are presented. Based on aspects of decision theory, the contract theory of insurance markets is discussed in detail. The course focusses on for insurance companies relevant aspects of the new institutional economics. Principal-agent problems which result from an informational advantage of policyholders are of particular interest, e.g. adverse selection or moral hazard.

The 2-hour course, which is supplemented by a 2-hour tutorial, takes place in winter trimester.