Game Theory Applications to Car Insurance Industry

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The car insurance industry faces many challenges, many of which can be analyzed through Games Theory. The research objective was to analyze three of them, using Game Theory as an analysis and forecasting tool. Therefore, three practical applications have been developed in order to differentiate between them both in the business objective and in the type of games that represent them. Specifically, the potential improvement of loss ratio of the Fully Comprehensive Insurance without excess modality has been
analyzed through games with asymmetric information, the problem of setting compensation modules through bi‐  and n‐personal games and the potential implementation of a loss ratio database through cooperative games. After the development of the applications it has been possible to identify solutions to 6 each one of the business problems raised and verify the flexibility, usefulness and applicability of the Game Theory, as well as its own ability to anticipate the result of situations, at first glance, uncertain.

José Manuel Brell Doval Universidad Carlos III de Madrid, Spain