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<p>This study examines asymmetric information in Taiwan’s life cancer insurance market using a large-scale dataset of newly purchased policies from 2012 to 2016. Our analysis reveals evidence of asymmetric information in whole-life cancer insurance, where higher coverage is positively associated with claim probability, consistent with adverse selection. In contrast, for term cancer insurance, there is a negative but statistically insignificant association between coverage and claims. High-coverage whole-life policies also exhibit a significantly higher likelihood of first-year claims, a pattern not observed for term policies. While coverage is positively associated with claim amounts for both contract types, quantile regressions reveal distinct patterns: coefficients increase across quantiles for term policies but remain relatively uniform for whole-life policies. These results suggest that policyholders selecting whole-life versus term cancer insurance differ systematically in underlying risk, with important implications for pricing, underwriting, and risk management in health-related insurance markets.</p>

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An analysis of asymmetric information in cancer insurance: evidence from term and whole-life policies in Taiwan

  • 期刊论文

  • 发表日期：

    2026年3月12日

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  • Chu-Shiu Li,
  • Sheng-Chang Peng

摘要

This study examines asymmetric information in Taiwan’s life cancer insurance market using a large-scale dataset of newly purchased policies from 2012 to 2016. Our analysis reveals evidence of asymmetric information in whole-life cancer insurance, where higher coverage is positively associated with claim probability, consistent with adverse selection. In contrast, for term cancer insurance, there is a negative but statistically insignificant association between coverage and claims. High-coverage whole-life policies also exhibit a significantly higher likelihood of first-year claims, a pattern not observed for term policies. While coverage is positively associated with claim amounts for both contract types, quantile regressions reveal distinct patterns: coefficients increase across quantiles for term policies but remain relatively uniform for whole-life policies. These results suggest that policyholders selecting whole-life versus term cancer insurance differ systematically in underlying risk, with important implications for pricing, underwriting, and risk management in health-related insurance markets.