Journal Archive

Home > Journal Archive
Cover Image
  • P-ISSN 1738-656X
  • E-ISSN 2586-4130

한국개발연구. Vol. 35, No. 3, September 2013, pp. 41-63

× KDI Open Access is a program of fully open access journals to facilitate the widest possible dissemination of high-quality research. All research articles published in KDI JEP are immediately, permanently and freely available online for everyone to read, download and share in terms of the Creative Commons Attribution 4.0 International License.

Adverse Selection in the Korean Storm and Flood Insurance Market

Chang-Gyun Park; Eun jung Yeo

Author & Article History

Manuscript received 21 December 2012; revision received 03 January 2013; accepted 13 June 2013.


We use a unique survey data set of storm and flood insurance in Korea to test for adverse selection. We find systematically positive relationships between the decision to buy the insurance and the insureds’ past history with, and potential for, losses from natural disasters. The empirical results suggest that consumers with higher loss rates will be more likely to purchase the insurance. This highlights the importance of considering the detailed features of insurance contracts, such as an improvement in the current insurance premium assistance program as the government amends its current policies regarding storm and flood insurance and disaster relief program.


풍수해보험(Storm and Flood Insurance), 역선택(Adverse Selection), 보험료 지원(Insurance Premium Assistance)

JEL Code

D12, D82, G22, H59

상단으로 이동