Empirical tests for ex post moral hazard
Empirical tests for ex post moral hazard in a market for automobile insurance.
In automobile (property) insurance, ex post moral hazard could be caused by “consumer-push and/or “producer-pull” as both parties may gain from receiving or performing more extensive and expensive repairs. A random survey of Australian automobile crashes (n=994) collected information on the nature and scope of the repairs, vehicle and respondent characteristics, and indicators of the latent crash severity. The aim of the forthcoming empirical analysis will enable “consumer-push” and “producer-pull” ex post moral hazard to be differentiated.