Dynamics of Demand for Rainfall Index Insurance : Evidence from a Commercial Product in India

Stein, Daniel

World Bank Group, Washington, DC

关键词: ADVERSE SELECTION;    BOND;    BUYER;    BUYERS;    CASH PAYMENT;   

DOI  :  10.1596/1813-9450-7035
RP-ID  :  WPS7035

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

This paper analyzes the dynamic natureof rainfall insurance purchasing decisions, specificallylooking at whether and why receiving an insurance payoutinduces a greater chance of purchasing insurance again thenext year. This analysis uses customer data from the Indianmicro-finance institution BASIX, and finds that receiving aninsurance payout is associated with a 9 to 22 percentagepoints increased probability of purchasing insurance thefollowing year. This affect appears to be driven bybehavioral effects of receiving a payout, and cannot beexplained by trust, learning, or direct effects of weather.Overall, low repurchasing rates even after payouts suggestthat current rainfall index insurance products are likely tocontinue struggling to achieve significant sales at market prices.