Uptake Of Insurance Research Articles

Age penalties and take-up of private health insurance.

Financial penalties for delayed enrollment could be useful tools to encourage people to enroll earlier in health insurance markets, but little is known about how effective they are. We use a large administrative dataset for a 10% random sample of all Australian tax-filers to study how people respond to a step-wise age-based penalty, and whether the effect has changed over time. Individuals must pay a 2% premium surcharge for each year they delay enrollment beyond age 31. The penalty stops after 10years of continuous hospital cover. The age-based penalty creates discontinuities in the incentive to insure by age, which we exploit to estimate causal effects. We find that people respond as expected to the initial age-penalty, but not to subsequent penalties. The 2% premium loading results in a 0.78-3.69 percentage points (or 2.1%-9.0%) increase in the take-up rate at age 31. We simulate the penalty impact and implications of potential reforms, and conclude that modest changes around the policy make little difference in the age distribution of insured, premiums or take-up rates. Our study provides important evidence on an understudied area in the literature and offers insights for countries considering financial penalties.

Health insurance uptake, poverty and financial inclusion in the Democratic Republic of Congo

AbstractThis study estimates the prevalence of health insurance coverage and associated socioeconomic factors in the Democratic Republic of Congo (DRC). Using the nationally representative household survey of the 2017/2018 DRC Multiple Indicator Cluster Survey (MICS), we applied weighted logistic regression models to identify regions and subgroups with low health insurance coverage. The study's findings revealed a low insurance coverage of less than 5%, with significant disparities across provinces and socioeconomic status. Additionally, three factors were strongly associated with the low health insurance coverage rates: education, wealth, and financial inclusion proxied by bank account ownership. Consequently, we recommend that the government, the private sector, and donors prioritize programs targeting provinces with less coverage and individuals without formal education to increase health insurance coverage. This study encourages the government to establish national programs to improve financial inclusion, which could positively impact poverty reduction and health insurance coverage. We also propose that the government initiates pilot projects for premium exemptions and through subsidies for vulnerable populations in the short term, and ensure formal employment for the majority of the population in the long term to facilitate the proper collection of premiums for individuals. Overall, this study contributes to the literature on health insurance in the DRC and sub‐Saharan Africa by identifying the socioeconomic factors that explain the prevalence of health insurance coverage. The findings of this study have important policy implications for the government, the private sector, and donors to promote health insurance coverage and achieve universal health coverage.

Implications of disclosure and non-disclosure of flood hazard maps – a synthesis for the Canadian context

Flood is an increasingly costly and impactful hazard in Canada. Risk management approaches need to be applied to stem rising costs and impacts of floods. The foundational tool that supports many risk management strategies is the development of flood mapping products. In Canada, however, there is only a patchwork of flood mapping available, and there is further variability in the accessibility of this information to private and public sectors. This article draws on published studies to synthesize the potential benefits and disbenefits of making flood maps more available and accessible in the Canadian context, with a focus on real-estate transactions, but also with consideration of implications to land use planning, flood insurance uptake, and social equity impacts. The review highlights that accessibility and regulated disclosure of flood maps reduce property values marginally, but not to the full discount that should be applied if flood risks were fully accounted for or realized. There are also substantial benefits of making flood mapping products more accessible, including greater social equity, by removing the challenge of data asymmetry (where some buyers and sellers have better information than others), better emergency preparedness, and increased insurance uptake to manage residual risks.

The effect of weather index insurance on social capital: Evidence from rural Ethiopia

AbstractWe study the effect of weather index insurance (WII) uptake on social capital. We measure individual social capital using experimental and survey‐based measures and relate it to the actual purchase of WII. We use propensity score matching (PSM) and an instrumental variable (IV) to address endogeneity concerns. Our descriptive and PSM estimates show that WII uptake negatively and significantly affects social capital. We find that insured households contribute less to the public good than uninsured households. We also find qualitatively and quantitatively similar results using our IV approach, yet insufficient power renders most of our IV estimates insignificant. We however report robust significant effects of instrumented WII uptake on sociopsychological outcomes—WII uptake increases perceptions of self‐sufficiency and free‐riding behavior: these are potential channels through which a negative effect on social capital comes about. Although far from conclusive, our paper provides several pieces of evidence that suggest WII uptake negatively affects social capital.

Uncovering the factors that affect earthquake insurance uptake using supervised machine learning

The escalating threat of natural disasters to public safety worldwide underlines the crucial role of effective environmental risk management tools, such as insurance. This is particularly evident in the case of earthquakes that occurred in Oklahoma between 2011 and 2020, which were linked to wastewater injection, underscoring the need for earthquake insurance. In this regard, from a survey of 812 respondents in Oklahoma, USA, we used supervised machine learning techniques (i.e., logit, ridge, least absolute shrinkage and selection operator (LASSO), decision tree, and random forest classifiers) to identify the factors that influence earthquake insurance uptake and to predict individuals who would acquire earthquake insurance. Our findings reveal that influential factors that affect earthquake insurance uptake include demographic factors such as older age, male gender, race, and ethnicity. These were found to significantly influence the decision to purchase earthquake insurance. Additionally, individuals residing in rental properties were less likely to purchase earthquake insurance, while longer residency in Oklahoma had a positive influence. Past experience of earthquakes was also found to positively influence the decision to purchase earthquake insurance. Both decision trees and random forests demonstrated good predictive capabilities for identifying earthquake insurance uptake. Notably, random forests exhibited higher precision and robustness, emerging as an encouraging choice for earthquake insurance modeling and other classification problems. Empirically, we highlight the importance of insurance as an environmental risk management tool and emphasize the need for awareness and education on earthquake insurance as well as the use of supervised machine learning algorithms for classification problems.

Use of subsidized insurance policy in climate adaptation strategies: the case of pastoral regions in China

ABSTRACT Insurance plays an important role in building rural livelihood resilience, in the context of climate change. Existing research examines the factors influencing insurance uptake and the effects of insurance adoption on informal risk-sharing strategies. This study, however, argues that insurance is an external policy intervention being introduced into a diversity of rural community adaptation strategies that are crucial components of resilient livelihood development. In this context, this study focuses on the case of subsidized livestock insurance in Tibetan pastoral regions with pooled cross-sectional data spanning three distinct time periods to explore how formal subsidized livestock insurance interacts with the diversity of adaptation strategies. Our findings first revealed a rising trend in subsidized livestock insurance adoption, accompanied by increased utilization of various on-pastoralism strategies, including custom-based and market-based approaches, and off-pastoralism strategies, such as increasing income sources. Second, our studies found a significant positive correlation between livestock insurance and the diversity index of market-based and off-pastoralism adaptation strategies, indicating a more complementary relationship. In addition, our studies discovered that the introduction of livestock insurance does not have an obvious correlation with custom-based strategies, dismissing the concerns of the potential displacement of informal custom-based adaptation strategies by subsidized livestock insurance. These results highlight that the subsidized livestock insurance policy is among many other adaptation strategies that rural communities have applied to respond to climate changes and build resilient livelihoods.

Predicting health insurance uptake in Kenya using Random Forest: An analysis of socio-economic and demographic factors.

Universal Health Coverage (UHC) is a global objective aimed at providing equitable access to essential and cost-effective healthcare services, irrespective of individuals' financial circumstances. Despite efforts to promote UHC through health insurance programs, the uptake in Kenya remains low. This study aimed to explore the factors influencing health insurance uptake and offer insights for effective policy development and outreach programs. The study utilized machine learning techniques on data from the 2021 FinAccess Survey. Among the models examined, the Random Forest model demonstrated the highest performance with notable metrics, including a high Kappa score of 0.9273, Recall score of 0.9640, F1 score of 0.9636, and Accuracy of 0.9636. The study identified several crucial predictors of health insurance uptake, ranked in ascending order of importance by the optimal model, including poverty vulnerability, social security usage, income, education, and marital status. The results suggest that affordability is a significant barrier to health insurance uptake. The study highlights the need to address affordability challenges and implement targeted interventions to improve health insurance uptake in Kenya, thereby advancing progress towards achieving Universal Health Coverage (UHC) and ensuring universal access to quality healthcare services.

Is health insurance really benefitting Indian population? Evidence from a nationally representative sample survey.

Universal health coverage (UHC) is the centrepiece of the sustainable development goals and aims to ensure access to essential and quality healthcare services to all without facing financial hardships. Several health insurance programmes have been launched in India to progress towards UHC. This study aims to assess the impact of health insurance (overall health insurance, government sponsored health insurance (GSHI), and private voluntary health insurance) on accessibility and utilization of inpatient care, out-of-pocket health expenditure (OOPE), catastrophic health expenditure (CHE), and impoverishment in India. The 75th round of National Sample Survey Office was used in the study, which covered 555,115 individuals, 113,823 households, and 91,445 hospitalization incidence all over India. Descriptive statistics, multivariable logistic regression, and propensity score matching (PSM) methods were employed. Enrolment under health insurance has impacted the accessibility and utilization pattern of hospitalization to some extent for the insured. PSM showed that enrolment under GSHI schemes reduced OOPE by INR 3314 (USD 49) and CHE incidence by 1%-4% at various thresholds. Among poor persons, there was a marginal but statistically significant reduction of OOPE among those enrolled under GSHI schemes (p<0.05). However, GSHI schemes did not statistically significantly reduce the CHE burden for poor persons enrolled (p>0.05). Furthermore, enrolment under private voluntary health insurance reduced OOPE by INR 13,511 (USD 198) and CHE by 13.47% at 10% threshold, 4.61% at 25% threshold, and 2.65% at 40% threshold. However, its uptake was primarily confined to richer economic quintiles and urban areas that exacerbates equity concerns. All the results were confirmed through robustness measures employed. There is a necessity to increase awareness and uptake of health insurance, along with introducing comprehensive insurance packages covering both inpatient and outpatient care. Also, increasing public health spending, strengthening public healthcare facilities, and improving regulatory implementation of private healthcare providers are imperative to augment financial protection.

Flood Risk Mapping and the Distributional Impacts of Climate Information

This paper examines the provision of official flood risk information in the United States and its distributional impacts on residential flood insurance take-up. Assembling new data on all flood maps produced after Hurricane Katrina, I first document that updated maps decreased the number of properties zoned in high-risk floodplains and incorrectly omitted five million properties that should have been rezoned inside these areas. Removals and omissions disproportionately occurred in neighborhoods with more Black and Hispanic residents. Leveraging the staggered timing of map updates, I estimate they decreased flood insurance take-up and exacerbated racial disparities in insurance coverage. These effects are driven by beliefs about risks and regulatory constraints. Correcting flood maps could increase welfare by $20 billion annually, but past updates decreased welfare due to distorted risk and price signals.

Profitability and prospects of crop insurance of some selected crops in Kishoreganj district of Bangladesh

Crop insurance is an essential tool for managing risk in agriculture. The primary goal of this study was to investigate how farmers felt about crop insurance and their willingness to pay for it. . The study was conducted to profile the socioeconomic characteristics, measure the profitability of crops, assess farmer’s willingness to pay crop insurance, and determine the factors that influence willingness to pay (WTP). A total of 107 farmers were chosen at random from Kishoreganj district in Bangladesh. The data were collected through a field survey using a semi-structured interview schedule. Karl Pearson’s correlation coefficient method was used. The study found that the majority of farmers have only had primary education or less. About one-third of the respondents could make savings of ten to twenty thousand taka each year. The most profitable crops were vegetables, jute, and wheat. Rice’s profitability, however, was hardly positive. Factors such as age, education, occupation, net income, and cultivable area have a positive correlation with the WTP for crop insurance for all crops except rice. However, the uptake of crop insurance is still relatively low in Bangladesh, and more efforts are needed to increase awareness and promote the benefits of crop insurance among farmers.

Feeder and fed cattle purchases of livestock risk protection

PurposePremium subsidy rates were increased in 2019 and 2020 for livestock risk protection (LRP) insurance, which is price insurance for cattle producers. The authors examined if the LRP subsidy rate changes affected the LRP coverage levels purchased by feeder and fed cattle producers.Design/methodology/approachThe authors collected the United States Department of Agriculture Risk Management Agency summary of business sales data for daily LRP purchases from 2015 to 2023. The authors estimated a multinomial logit model to determine if subsidy rate changes were associated with the likelihood of LRP policies being purchased at different coverage levels.FindingsAfter the 2019 and 2020 subsidy rate changes, the likelihood of producers buying LRP-feeder cattle policies with coverage over 95% increased relative to the policies with coverage less than 89.99% but did not influence the likelihood of producers buying LRP-feeder cattle policies with coverage between 90 and 94.99% relative to policies with coverage less than 89.99%. Marginal effects show these subsidy rate changes increased the likelihood of buyers purchasing LRP-feeder cattle policies with greater than 95% coverage. The subsidy change did not affect the purchase of LRP-fed cattle policies.Originality/valueThe results demonstrate the influence of the recent LRP policy adjustments on insurance purchases, which could be important for agency officials and policy makers. This is the first study to explore the LRP policy purchases which provides the United States cattle industry insight into the LRP price insurance take-up, which can guide producer extension education on managing price risk.

Households’ health insurance status and COVID-19 vaccination in Nigeria: A recursive bivariate probit and decomposition estimation

Health insurance remains a viable option for the promotion of healthcare service utilization and efficiency. Very few studies have analyzed the linkages between health insurance uptake and COVID-19 vaccination decisions. This paper contributes to existing literature by recursively analyzing the effect of health insurance uptake on COVID-19 vaccination status in Nigeria. The data were the second wave of the National Longitudinal Phone Survey (NLPS), comprising 2750 respondents. The data were analyzed with the recently developed Recursive Bivariate Probit and Decomposition Estimation approach. The results showed that 31.50% and 7.78% were vaccinated and health insured, respectively. Health insurance was positively and significantly influenced (p<0.05) by being from the North West zone, urban residence, needing non-COVID maternal health, and adults or households’ heads as the major vaccination decision makers. In addition, being vaccinated or having a vaccinated households’ member was negatively and significantly influenced by three zonal variables (North East, North West, and South East) and urban residence, but positively influenced by age, needing COVID-19 related health services, concurring with making the vaccines mandatory and adults being the major vaccination decision makers. Health insurance recursively influenced being vaccinated or having a vaccinated households’ member with significant positive treatment effects (p<0.05). It was concluded that efforts to promote health insurance will facilitate acceptability of COVID-19 vaccines. In addition, uptake of health insurance and COVID-19 vaccination can be enhanced with proper focus on some peculiar zonal and sectoral factors through initiatives that target adult households’ members.

The impact of health insurance enrollment on health outcomes in Kenya

BackgroundThe achievement of the global agenda on universal health coverage (UHC) is pivotal in ensuring healthy lives and promoting the well-being of all. However, achieving healthy lives and wellbeing of all has been hampered by the challenge of health care financing. As such, healthcare financing, through health insurance is gaining popularity in developing countries such as Kenya, in their pursuit to achieve universal health coverage. The primary purpose of health insurance and delivery is to improve health. However, there is a paucity of evidence on the effectiveness of health insurance in improving the health outcomes and health status of the Kenyan population. Therefore, this study aimed to analyze the impact of health insurance on health outcomes in Kenya.MethodsThe study utilized the most recent nationally representative Kenya Integrated Household Budget Survey (KIHBS) 2015/16 dataset in order to analyze the impact of health insurance on health outcomes. The instrumental variable 2-stage least squares (IV 2SLS) and control function approach (CFA) estimation techniques were used to cater for potential endogeneity and heterogeneity biases present in ordinary least squares (OLS) estimators.ResultsHealth insurance enrolment leads to a reduction in mortality, thereby improving the health status of the Kenyan population, despite low levels of insurance uptake. However, the insured population experienced higher chronic illnesses and out-of-pocket (OOP) expenditures raising concerns about financial risk protection. The fact that health insurance is linked to chronic illnesses not only reinforces the reverse causality of health insurance and health status, but also that the effects of potential adverse selection strongly drive the strength and direction of this impact.ConclusionsWe conclude that health insurance enrolment reduces mortality and hence has a beneficial impact in promoting health. Health insurance coverage therefore, should be promoted through the restructuring of the National Hospital Insurance Fund (NHIF) fragmented schemes and by consolidating the different insurance schemes to serve different population groups more effectively and equitably. The government should revisit the implementation of a universal social health insurance scheme, as a necessary step towards UHC, while continuing to offer subsidies in the form of health insurance to the marginalized, vulnerable and poor populations.

Strategic Capabilities and Performance of Insurance Firms Listed at the Nairobi Securities Exchange, Kenya

The insurance sector has witnessed growth in both the corporate and private sectors driven by increased insurance uptake among corporations and individuals. However, despite the dynamic nature of the sector, some insurance firms face significant challenges in keeping up with their counterparts. To address the performance variations in the insurance sector, it is crucial to examine strategic capabilities such as technical knowledge, innovation, learning culture and service quality and their impact on performance of NSE listed firms in Kenya. This study aims to investigate how strategic capabilities influence the performance of these firms. The specific objectives of the study were: to examine the effect of innovation capability on the performance of NSE-listed insurance companies in Kenya; to determine the effect of service quality capability on the performance of NSE-listed insurance companies in Kenya; to investigate the effect of technical knowledge capability on the performance of NSE-listed insurance companies in Kenya and to examine the effect of learning culture capability on the performance of NSE-listed insurance companies in Kenya. The study was anchored on the Resource based view theory, Knowledge based view and Dynamic capabilities theories. A descriptive cross-sectional survey research design was adopted targeting 258 senior staff members of six listed insurance firms on the Nairobi Securities Exchange. A sample size of 156 respondents was determined by Yamane formula and stratified random sampling technique used for sample selection. Structured questionnaire was used for primary data collection with a pilot test involving 16 respondents to ensure the validity and reliability of the research instrument. Data analysis was performed with an aid of statistical packages for social sciences (SPSS) software employing descriptive statistics, correlation analysis and multiple regression models. The findings revealed that innovation strategic capability, service quality strategic capability, technical knowledge strategic capability and learning culture strategic capability all had a positive significant relationship with performance of NSE-listed insurance companies in Kenya. The study therefore recommended that insurance firms listed at the NSE should invest in innovation, service quality, technical knowledge and learning culture to enhance their performance.

Predictors of health insurance uptake among residents of Lagos, Nigeria

Predictors of health insurance uptake among residents of Lagos, Nigeria

An " Academic Review and Critique of Gender Dynamics and Life Insurance Uptake in Ghana: A Study of the 2018 Publication by Ampaw et al."

The study conducted by Ampaw et al. titled “Gender perspective on life insurance demands in Ghana" examines the factors affecting the adoption of life insurance by male and female household heads. Their findings suggest that women in Ghana purchase more life insurance products than men, which may be useful for insurers in maximizing profits. However, the study overlooks critical considerations such as claim costs, administrative expenses, and profitability. While the authors' unique focus on gender dynamics is noteworthy, they did not consider household size, literacy levels, premium costs, and government incentives for women to purchase policies. Prior research indicates that education, awareness, income, and employment are key determinants of life insurance uptake in Ghana, which contrasts with the authors' findings. Further research is necessary to examine the relationship between insurance and customer value or profitability. In conclusion, while Ampaw et al.'s research adds to the scarce literature on life insurance demand in Africa, it lacks practicality and ignores significant factors. Additional research is necessary to comprehend the determinants of life insurance uptake in Ghana and insurance's role in customer value and business profitability in Africa.&#x0D; &#x0D; JEL classification codes for this article could include:&#x0D; &#x0D; G22: Insurance; Insurance Companies; Actuarial Studies&#x0D; J16: Economics of Gender; Non-labor Discrimination&#x0D; O55: Africa; Insurance and Insurance Markets&#x0D;

Behavioral aspects of household portfolio choice: Effects of loss aversion on life insurance uptake and savings

This paper provides empirical evidence that loss aversion decreases insurance demand and increases savings demand using individual-level data on the US elderly. Specifically, loss-averse individuals have a significantly lower ownership rate of term life insurance which is pure insurance, and they have a higher ownership rate of whole life insurance, which has a savings element. This paper also shows that loss-averse individuals own a smaller amount of stock (equity) than others and a greater amount of non-risky financial assets, such as deposits and bonds. This aligns with the prospect theory's prediction that boundedly rational consumers may view pure protection insurance (term life insurance) as a “risky investment” like stocks because the insured may just lose the premiums if a bad event does not occur during the policy term. They instead opt for “safer options” such as whole life insurance, which guarantees payment of a death benefit, or deposits and bonds. Furthermore, this paper provides suggestive evidence that loss aversion has a negative impact on insurance demand beyond the US, by showing that there is a negative association between loss aversion and insurance penetration rates in 51 countries.

A comprehensive examination ofthe economic impact ofout-of-pocket health expenditures inIndia.

More than 50% of health expenditure is financed through out-of-pocket payments in India, imposing a colossal financial burden on households. Amidst the rising incidence of non-communicable diseases, injuries, and an unfinished agenda of infectious diseases, this study examines comprehensively the economic impact of out-of-pocket health expenditure (OOPE) across 17 disease categories in India. Data from the latest round of the National Sample Survey (2017-18), titled 'Household Social Consumption: Health', were employed. Outcomes, namely, catastrophic health expenditure (CHE), poverty headcount ratio, distressed financing, foregone care, and loss of household earnings, were estimated. Results showed that 49% of households that sought hospitalization and/or outpatient care experienced CHE and 15% of households fell below the poverty line due to OOPE. Notably, outpatient care was more burdensome (CHE: 47.8% and impoverishment: 15.0%) than hospitalization (CHE: 43.1% and impoverishment: 10.7%). Nearly 16% of households used distressed sources to finance hospitalization-related OOPE. Cancer, genitourinary disorders, psychiatric and neurological disorders, obstetric conditions, and injuries imposed a substantial economic burden on households. OOPE and associated financial burden were higher among households where members sought care in private healthcare facilities compared with those treated in public facilities across most disease categories. The high burden of OOPE necessitates the need to increase health insurance uptake and consider outpatient services under the purview of health insurance. Concerted efforts to strengthen the public health sector, improved regulation of private healthcare providers, and prioritizing health promotion and disease prevention strategies are crucial to augment financial risk protection.

Determinants of Uptake of Community-Based Health Insurance in the Bamenda Ecclesiastical Province Health Assistance

This study was aimed at identifying the determinants of the uptake of Community-Based Health Insurance within the Bamenda Ecclesiastical Province Health Assistance (BEPHA) of Cameroon. To meet this objective, data from 2043 structured questionnaires administered in the partner health facilities of the Bamenda Ecclesiastical Province Health Assistance was used. Stata 14.2 was used to process the data. It adopted the logit model to analyse the data. While age, level of income, religion and marital status showed positive and significant relationship with adherence, level of education, place of residence and distance to the nearest affiliated health facility were found to be negatively related to insurance uptake. In order to increase rate of adherence for people who are between 30 and 49 years of age, we recommended that government and stakeholders should work in synergy with insurers to reduce the insurance premiums for those in this age group. Policies to ensure balanced regional development should be implemented to the later with more emphasis on infrastructural development of rural areas so that they can experience increase in their incomes and so demand for better health services. Specifically, the development of infrastructures like roads, electricity and others will cause the creation of more job opportunities for the rural settlers as well as taking their products to the market in exchange for incomes which will in turn permit them to afford insurance premiums to adhere.

Drivers of Health Insurance Coverage in Low Income Settlements: A Case of Kibera Informal Settlement, Nairobi County, Kenya

Insurance is critical for any country's economic growth and development to be sustainable. In rural areas of Kenya, among the illiterate, unemployed, poor, and vulnerable in society, health insurance adoption is extremely low. This paper focuses on determining the drivers for health insurance uptake among low-income populations in Kibera, Nairobi County. Semi structured questionnaires were administered to households located in Kibera informal settlements to collect data. The Yamane (1967) formula was used to select the sample size. Simple random sampling was adopted in selecting 399 respondents. Both descriptive and inferential analysis were conducted. The binary probit regression model was employed. Health insurance ownership was used as the dependent variable while age, gender, marital status, household size, school attainment, occupation, income levels, religion, cultural beliefs, frequency of hospital visits, cost of premiums, and pre-existing illness were used as the independent variables. Findings revealed that only 27.6 percent of the respondents had health insurance coverage. The findings further revealed that occupation, income levels, and religion significantly influence health insurance ownership among low-income populations in Kibera, Nairobi. Public health insurance cover was the most owned type of health insurance scheme. Recommendations were highlighted for the ministry of health and other relevant stakeholders to raise knowledge on the various health insurance options available and improve flexibility of the products to drive insurance uptake. In addition, national and county governments need to develop programmes and policies that could empower households in the informal settlements. Further, it is necessary for the government to subsidise the cost of acquiring public health insurance covers since this would encourage uptake among low-income families. The ministry of health should also work in conjunction with various religious denominations to campaign for uptake of health insurance among the poor.