Simulation developed at JMU gets national release

Economics

by William Wood

 
Insurance Simulation - 2019

Pictured: In early testing, Roger Wilkins of Shenandoah County and Tracy Moyers of Rockingham County make the difficult “thumbs up” call on insuring a risky driver.


An insurance simulation developed at James Madison University for high school classrooms has been released nationally, just in time for fall classes.

“Choosing Sides: Which Drivers Would You Insure?” puts groups of students in the role of insurance companies making decisions on issuing policies to drivers with different risk characteristics.

“This is a realistic simulation,” said Dr. William C. Wood, director of the JMU Center for Economic Education and head of the JMU Economics Department. “We have 52-year-old parents driving minivans with perfect driving records, and we have twenty-somethings with multiple accidents driving sports cars.”

Collaborating with Wood on the simulation was co-author M. Scott Niederjohn, dean of the J. Garland Schilcutt School of Business and Entrepreneurship at Lakeland University in Plymouth, Wisconsin. The simulation was field-tested at summer workshops for teachers at JMU and other Virginia schools sponsored by the Virginia Council on Economic Education.

After the student groups choose which drivers to insure and collect premiums, a roll of the dice shows the outcome.

The dice chart from the game was calibrated to reflect the risk of a leading national insurer.

“Some groups are very aggressive, insuring every driver,” Wood said. “With some lucky rolls of the dice, they can win the most money – but they can also be wiped out by one accident.”

Wood said the simulation shows how there is risk in every insurance decision. “That minivan driver can get unlucky, and that young hot-headed Porsche driver can go accident-free.”

The lesson is available free at EconEdLink.org. EconEdLink.org is a national library of economics and personal finance lessons maintained by the Council for Economic Education.

As published online, the lesson includes all instructions and game cards necessary to conduct the simulation, along with suggested questions and answers.

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Published: Wednesday, September 18, 2019

Last Updated: Thursday, November 2, 2023

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