Development Of Mutual Insurance In Russia Based On Social Economy Idea

Abstract

One of the problems of the Russian insurance market is the distrust of the population towards commercial insurance companies. With poor financial literacy, citizens often cannot get the level of insurance they wanted. In addition, the high cost of policies at low incomes of the population and small businesses scares away potential insurers. Mutual insurance could be the method of creating an insurance product that would reconcile the insured with its financial capabilities. By developing mutual insurance as a type of social entrepreneurship, the State can achieve certain results not in protecting the population from risks only, but also in increasing the level of financial literacy of the population. This will have an impact on the financial market as a whole. The purpose of the article is to justify the potential possibility of a new direction of development of the insurance market of Russia based on stimulation of the activities of mutual insurance societies. The specific nature of the business model of mutual insurance meets the psychological needs of citizens: protection, solidarity, mutual assistance and equal democratic participation in governance. However, the state has to recognize the importance of this direction and pay sufficient attention to ensuring the financial sustainability of mutual insurance societies. The development of mutual insurance as a type of social entrepreneurship will reverse citizens "mistrust of insurance. In addition, it will provide citizens with insurance services at a fair price and according to their needs.