Narrow framing and long‐term care insurance

TitleNarrow framing and long‐term care insurance
Publication TypeJournal Article
Year of PublicationForthcoming
AuthorsGottlieb, D, Mitchell, OS
JournalJournal of Risk and Insurance
ISSN Number0022-4367
KeywordsFinances, Long-term care insurance

We propose a model of narrow framing in insurance and test it using data from a new module we designed and fielded in the Health and Retirement Study. We show that respondents subject to narrow framing are substantially less likely to buy long-term care insurance than average. This effect is much larger than the effects of risk aversion or adverse selection, and it offers a new explanation for why people underinsure their later-life care needs.

Short TitleJournal Risk and Insurance
Citation Key10166