Can Health Microinsurance Protect the Poor?
McGuinness, E., Microfinance Opportunities, October 2011
This study contributes to the debate on whether microinsurance is a good deal for the poor by examining a client-managed health insurance model implemented by Uplift India Association (Uplift). The study focuses on one specific component of client value, namely, financial value.
It examines whether and how Uplift provides financial value to its members and includes a case study comparing specific experiences of insured and uninsured households when faced with malaria. It supplements case study findings with an analysis of Uplift’s claims and financial data.
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Innovative Microinsurance Distribution: The case of Pioneer Seeds in India
Akhilandeswari; Janani, Mangesh Patankar, CIRM, June 2010
This case study on innovative microinsurance distribution analyses the case of an agriculture input supplier who purchased a blanket insurance product that insured an agreed value of seeds against low rainfall in the sowing season.
The company, leveraging its robust marketing channels, passed on the benefits of this cover to farmers who purchased the seeds in small pre-packed quantities. The insurance cover was bundled with the seed packets, covering the extent of its cost. Thus, a mainstream insurance product, without much hassle, was translated into a microinsurance cover.
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Social Networks and the Decision to Insure: Evidence from Randomized Experiments in China
Caiy; Jing, University of California, Berkeley, November 2011
Using data from a two-year randomised experiment in rural China, this paper studies the influence of social networks on the decision to adopt a new weather insurance product and the mechanisms through which social networks operate.
In the first year, financial education was provided to a random subset of farmers and the paper found a large social network effect on insurance take-up: for untreated farmers, having an additional friend receiving financial education raises take-up by almost half as much as obtaining financial education directly, a spill over effect equivalent to offering a 12% reduction in the average insurance premium.
By varying the information available to subjects about their peers’ take-up decisions and using randomised default options, the paper shows that the positive social network effect is not driven by scale effects, imitation, or informal risk-sharing, but instead by the diffusion of insurance knowledge.
One year later, social networks continue to affect insurance demand: observing an above-median share of friends receiving payouts increases insurance take-up at a rate equivalent to about 50% of the impact of receiving payouts directly. The paper also finds that social network effects are larger in villages where households are more strongly connected, and when the people who receive financial education first are more central in the social network.
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