NEHRP Clearinghouse

Disaster Insurance Protection, Public Policy Lessons.
Kunreuther, H.; Ginsberg, R.; Miller, L.; Sagi, P.; Slovic, P.
National Science Foundation, Washington, DC. Applied Science and Research Applications., cJanuary 1978, 422 p.
An examination is made of the public's indifferent attitude toward protection against the consequences of natural hazards and proposes solutions to overcome this lack of concern. Institutional arrangements associated with marketing flood and earthquake insurance in the United States are discussed and a theoretical framework is developed upon which field surveys and laboratory experiments are based. The expected utility model of choice used by economists for public policy is contrasted with a sequential model based on concepts from behavioral science and organizational theory. Literature from economics, geography, psychology, and sociology are cited, and both models are combined into an integrated framework. A detailed analysis of the field survey data is presented in which personal comments from 3,000 interviews are incorporated. Results from controlled laboratory experiments on individual decision processes with respect to low-probability events are synthesized with those of the field survey. The study provides detailed characteristics of the behavior and attitudes of individuals toward mitigation and relief policies and the characteristics of hazard-prone regions and communities.
; Hazards; Risk; Models; Earthquakes; Protection; Decision making; Behavior; Losses; Motivation; Attitudes; Insurance; Disasters; Floods