The Theory and Practice of Innovation in the Private Insurance Industry: ABSTRACT

This paper is concerned with an analysis of the performance of private insurance with respect to innovation. A survey of insurance industry ex-ecutives generated a list of innovations. Innovations were judged on the basis of whether they provided a significant alternative to the consumer, were in the direction of achieving the "ultimate" insurance product, and were at least as well suited to treatment in the private sector as the public. Recommendations are made for the industry, the consumer, and most importantly, the regulators regarding changes needed to create a more favorable climate for innovation.