Munich Map

Munich Map on For this reason, consumption of vaccines and other treatments for infectious diseases tend to be lower than what is socially optimal. Governments seek to solve this market failure by subsidizing vaccines and/or requiring them by law. Consumers face considerable uncertainty about their future health care expenditures. One is always at risk of exogenous health shocks, such as being hit by a car. Because many people are risk-averse, health insurance is very attractive. Health insurance allows people to transfer the financial risk of health shocks to insurance companies. Health insurers are willing to assume this risk because as long as the health shocks of their enrollees are independent, insurers can spread the risk of health shocks over large numbers of enrollees and enjoy considerable confidence about the amount of future claims. Munich Map 2016.

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