Dynamics of Demand for Rainfall Index Insurance : Evidence from a Commercial Product in India
This paper analyzes the dynamic nature of rainfall insurance purchasing decisions, specifically looking at whether and why receiving an insurance payout induces a greater chance of purchasing insurance again the next year. This analysis uses custom...
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| Format: | Policy Research Working Paper |
| Language: | English en_US |
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World Bank Group, Washington, DC
2014
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| Online Access: | http://documents.worldbank.org/curated/en/2014/09/20212360/dynamics-demand-rainfall-index-insurance-evidence-commercial-product-india http://hdl.handle.net/10986/20381 |
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okr-10986-203812021-04-23T14:03:55Z Dynamics of Demand for Rainfall Index Insurance : Evidence from a Commercial Product in India Stein, Daniel ADVERSE SELECTION BOND BUYER BUYERS CASH PAYMENT COMMERCIAL INSURANCE CRITICAL MASS CROP LOSS CUSTOMER DATA DEVELOPING COUNTRIES DUMMY VARIABLE ECONOMIC DEVELOPMENT ECONOMICS EMPLOYMENT FINANCIAL SERVICES GOVERNMENT SUBSIDIES INCOME INCOMES INNOVATIONS INSTITUTION INSURANCE INSURANCE COMPANIES INSURANCE COMPANY INSURANCE CONTRACT INSURANCE CONTRACTS INSURANCE COVERAGE INSURANCE MARKET INSURANCE MARKETS INSURANCE PAYMENTS INSURANCE PAYOUT INSURANCE PAYOUTS INSURANCE POLICIES INSURANCE POLICY INSURANCE PREMIUMS INSURANCE PRODUCT INSURANCE PRODUCTS INTERNATIONAL BANK LEVEL OF COVERAGE LIQUIDITY MARKET PRICES MARKET RATES MARKETING MICRO-FINANCE MICRO-FINANCE INSTITUTION MICRO-INSURANCE MICROFINANCE MICROFINANCE INSTITUTION MICROINSURANCE MORAL HAZARD MUTUAL INSURANCE NETWORKS OPEN ACCESS OUTPUT PAYOUT PAYOUT RATIO PAYOUT RATIOS PAYOUTS PENETRATION RATES PERSONAL INFORMATION PHYSICAL GOODS RESULT RESULTS RETURN RISK MANAGEMENT RISK SHARING RISK TAKING SEARCH SEARCHES SOCIAL NETWORKS TIME FRAME TRANSACTION USES VERIFICATION WEALTH EFFECTS This paper analyzes the dynamic nature of rainfall insurance purchasing decisions, specifically looking at whether and why receiving an insurance payout induces a greater chance of purchasing insurance again the next year. This analysis uses customer data from the Indian micro-finance institution BASIX, and finds that receiving an insurance payout is associated with a 9 to 22 percentage points increased probability of purchasing insurance the following year. This affect appears to be driven by behavioral effects of receiving a payout, and cannot be explained by trust, learning, or direct effects of weather. Overall, low repurchasing rates even after payouts suggest that current rainfall index insurance products are likely to continue struggling to achieve significant sales at market prices. 2014-10-06T20:54:59Z 2014-10-06T20:54:59Z 2014-09 http://documents.worldbank.org/curated/en/2014/09/20212360/dynamics-demand-rainfall-index-insurance-evidence-commercial-product-india http://hdl.handle.net/10986/20381 English en_US Policy Research Working Paper;No. 7035 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank Group, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research South Asia India |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English en_US |
| topic |
ADVERSE SELECTION BOND BUYER BUYERS CASH PAYMENT COMMERCIAL INSURANCE CRITICAL MASS CROP LOSS CUSTOMER DATA DEVELOPING COUNTRIES DUMMY VARIABLE ECONOMIC DEVELOPMENT ECONOMICS EMPLOYMENT FINANCIAL SERVICES GOVERNMENT SUBSIDIES INCOME INCOMES INNOVATIONS INSTITUTION INSURANCE INSURANCE COMPANIES INSURANCE COMPANY INSURANCE CONTRACT INSURANCE CONTRACTS INSURANCE COVERAGE INSURANCE MARKET INSURANCE MARKETS INSURANCE PAYMENTS INSURANCE PAYOUT INSURANCE PAYOUTS INSURANCE POLICIES INSURANCE POLICY INSURANCE PREMIUMS INSURANCE PRODUCT INSURANCE PRODUCTS INTERNATIONAL BANK LEVEL OF COVERAGE LIQUIDITY MARKET PRICES MARKET RATES MARKETING MICRO-FINANCE MICRO-FINANCE INSTITUTION MICRO-INSURANCE MICROFINANCE MICROFINANCE INSTITUTION MICROINSURANCE MORAL HAZARD MUTUAL INSURANCE NETWORKS OPEN ACCESS OUTPUT PAYOUT PAYOUT RATIO PAYOUT RATIOS PAYOUTS PENETRATION RATES PERSONAL INFORMATION PHYSICAL GOODS RESULT RESULTS RETURN RISK MANAGEMENT RISK SHARING RISK TAKING SEARCH SEARCHES SOCIAL NETWORKS TIME FRAME TRANSACTION USES VERIFICATION WEALTH EFFECTS |
| spellingShingle |
ADVERSE SELECTION BOND BUYER BUYERS CASH PAYMENT COMMERCIAL INSURANCE CRITICAL MASS CROP LOSS CUSTOMER DATA DEVELOPING COUNTRIES DUMMY VARIABLE ECONOMIC DEVELOPMENT ECONOMICS EMPLOYMENT FINANCIAL SERVICES GOVERNMENT SUBSIDIES INCOME INCOMES INNOVATIONS INSTITUTION INSURANCE INSURANCE COMPANIES INSURANCE COMPANY INSURANCE CONTRACT INSURANCE CONTRACTS INSURANCE COVERAGE INSURANCE MARKET INSURANCE MARKETS INSURANCE PAYMENTS INSURANCE PAYOUT INSURANCE PAYOUTS INSURANCE POLICIES INSURANCE POLICY INSURANCE PREMIUMS INSURANCE PRODUCT INSURANCE PRODUCTS INTERNATIONAL BANK LEVEL OF COVERAGE LIQUIDITY MARKET PRICES MARKET RATES MARKETING MICRO-FINANCE MICRO-FINANCE INSTITUTION MICRO-INSURANCE MICROFINANCE MICROFINANCE INSTITUTION MICROINSURANCE MORAL HAZARD MUTUAL INSURANCE NETWORKS OPEN ACCESS OUTPUT PAYOUT PAYOUT RATIO PAYOUT RATIOS PAYOUTS PENETRATION RATES PERSONAL INFORMATION PHYSICAL GOODS RESULT RESULTS RETURN RISK MANAGEMENT RISK SHARING RISK TAKING SEARCH SEARCHES SOCIAL NETWORKS TIME FRAME TRANSACTION USES VERIFICATION WEALTH EFFECTS Stein, Daniel Dynamics of Demand for Rainfall Index Insurance : Evidence from a Commercial Product in India |
| geographic_facet |
South Asia India |
| relation |
Policy Research Working Paper;No. 7035 |
| description |
This paper analyzes the dynamic nature
of rainfall insurance purchasing decisions, specifically
looking at whether and why receiving an insurance payout
induces a greater chance of purchasing insurance again the
next year. This analysis uses customer data from the Indian
micro-finance institution BASIX, and finds that receiving an
insurance payout is associated with a 9 to 22 percentage
points increased probability of purchasing insurance the
following year. This affect appears to be driven by
behavioral effects of receiving a payout, and cannot be
explained by trust, learning, or direct effects of weather.
Overall, low repurchasing rates even after payouts suggest
that current rainfall index insurance products are likely to
continue struggling to achieve significant sales at market prices. |
| format |
Publications & Research :: Policy Research Working Paper |
| author |
Stein, Daniel |
| author_facet |
Stein, Daniel |
| author_sort |
Stein, Daniel |
| title |
Dynamics of Demand for Rainfall Index Insurance : Evidence from a Commercial Product in India |
| title_short |
Dynamics of Demand for Rainfall Index Insurance : Evidence from a Commercial Product in India |
| title_full |
Dynamics of Demand for Rainfall Index Insurance : Evidence from a Commercial Product in India |
| title_fullStr |
Dynamics of Demand for Rainfall Index Insurance : Evidence from a Commercial Product in India |
| title_full_unstemmed |
Dynamics of Demand for Rainfall Index Insurance : Evidence from a Commercial Product in India |
| title_sort |
dynamics of demand for rainfall index insurance : evidence from a commercial product in india |
| publisher |
World Bank Group, Washington, DC |
| publishDate |
2014 |
| url |
http://documents.worldbank.org/curated/en/2014/09/20212360/dynamics-demand-rainfall-index-insurance-evidence-commercial-product-india http://hdl.handle.net/10986/20381 |
| _version_ |
1764445210532642816 |