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作者

Ruben H.G.M. Cox;Remco C.J. Zwinkels

来源

REAL ESTATE ECONOMICS,Vol.47,Issue4,P.977-1012

语言

英文

关键字

作者单位

Erasmus School of Economics, Erasmus University Rotterdam, P.O. Box 1738, 3000 DR, Rotterdam, Authority of Financial Markets, P.O. Box 11723, 1000 GS Amsterdam;VU University Amsterdam and Tinbergen Institute, De Boelelaan 1105, 1081 HV, Amsterdam

摘要

Individuals tend to underinsure on low probability, high consequence risks. Using a survey data set from a unique institutional context, we provide an assessment of the underinsurance puzzle by studying mortgage insurance adoption among Dutch homeowners. The results indicate that the demand for mortgage insurance is affected by risk exposure, type of mortgage lender, and the involvement of financial advisors. We document that wealthier and younger mortgagors are more likely to insure. However, locus of control, house price expectations, and precautionary savings are not related to insurance demand. Finally, we find evidence that borrower (over)confidence negatively affects the likelihood that insurance is bought.