Abstract

MEDINA-HURTADO, Santiago; RESTREPO-MORALES, Jorge  and  BEDOYA, Alejandro. Expected losses and the patrimonial detriment for vehicle theft in Colombia. Cuad. Econ. [online]. 2017, vol.36, n.71, pp.261-292. ISSN 0121-4772.  https://doi.org/10.15446/cuad.econ.v36n71.47450.

This paper presents a methodological approach based on the Value at Operational Risk (VaRop) concept in order to quantify the maximum economic loss expected for the theft of insured vehicles in Colombia disaggregated by insurance company and for major cities. The financial loss to owners whose vehicles are not insured is also estimated. To do this, we identified the probability distributions associated to the series of thefts both in terms of frequency and monthly financial loss, which were aggregated using a Monte Carlo simulation process, it permit estimate the operational VaR or maximum probable loss at 95%. For the equity loss, a multidimensional model was proposed for the Distribution of Wealth Quantify Detriment incorporating five probability distributions in a Montecarlo simulation process. The study highlights the grave problem of vehicle theft in Colombia. There is a maximum economic loss for insurers of $9,130.0 million/month and a capital expense for citizens in the order of $16,458.0 mill/month. There is also a low insurance culture: only the 28.16% of the stolen vehicles are insured.

JEL: C53, C58, G22, G31, M21.

Keywords : Operative risk quantification; vehicle theft; capital detriment; losses simulation.

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