Analytics
Forecasting Impact with Rigorous Models
Why actuarially sound products still stall—and how behavior, aspirations, and design can unlock renewal.
Overview
National insurers had actuarially sound products but stagnant renewal. The hypothesis: demand frictions were behavioral and social, not only basis risk.
Uptake is not only about basis risk. It is about whether the product fits how farmers see themselves, their peers, and the season ahead.
Advanced Economic Research
Climate & Development (2025)
Challenge · Solution · Result
- Challenge: Despite rising climate risks, farmer participation in index-based insurance schemes remained critically low.
- Solution: Behavioral econometrics linking non-cognitive skills, aspirations, and risk perceptions to adoption decisions.
- Result: Advanced econometric and behavioral analysis that turns complex data into clearer productivity, climate, and welfare insights.
The Adoption Gap
When sound products still stall
Despite rising climate risks, farmer participation in index-based insurance schemes remained critically low. National insurers had actuarially sound products but stagnant renewal.
The working hypothesis: demand frictions were behavioral and social, not only basis risk.
Behavior in the Model
From psychometrics to renewal flows
We applied behavioral econometrics linking non-cognitive skills, aspirations, and risk perceptions to adoption decisions—matching psychometric batteries to administrative enrollment and embedding message experiments in USSD renewal flows.
Latent variable models for aspirations and survival analysis for drop-off timing clarified when and why farmers exited.
Design That Renews
Products and policy that can scale
The work informed tailored insurance products and policy frameworks for national climate adaptation strategies.
Revised renewal scripts, district-level peer-matching for extension demos, and regulator briefings on reporting basis risk alongside behavioral uptake metrics closed the loop from evidence to practice.
Partners
- National Insurance Commission
- Agricultural insurance consortia
