The life insurance market is susceptible to two primary challenges: moral hazard and adverse selection. Moral hazard arises when individuals take in riskier behaviors after purchasing insurance, knowing they are protected from the full results. For example, a insured person might ignore their health significantly knowing that the insurer will cover… Read More

The core concept behind protection markets is shared risk. Essentially, a large group of policyholders contribute payments into a common fund. This fund is then used to reimburse those within the pool who experience a covered incident. The beauty of this framework lies in the law of large numbers: while any individual person's risk might be substan… Read More