Buyers and sellers of flood insurance can benefit from a longer-term perspective, and long-term multiyear policies may be the key to reforming the current system, a Wharton School professor said last week.

Executive Summary

Multiyear policies may be the key to reforming the current flood insurance system, Wharton School Professor Howard Kunreuther says, invoking the principles of behavioral economics to support his proposal.

Speaking at the SAP Financial Services conference in New York, Howard Kunreuther, Professor of Decision Science and Business and Public Policy at the Wharton School of the University of Pennsylvania, drew on the principles of behavioral economics as he proposed ways to improve insurance market dynamics for the coverage of low probability/high consequence (LP-HC) events.

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