Uptake of Multiple Microinsurance Schemes: Evidence from Sri Lanka

Since it is common among households to use more than one form of microinsurance, this paper estimates the uptake of different kinds of microinsurance by the same population. We use a multivariate probit model which examines the participation in the different forms of insurance simultaneously. By doing this, we can establish whether participation patterns in different types of microinsurance options indicate if the participation in specific insurance schemes is complementary or a substitute. We establish that membership of a microfinance institution means that households are more likely to have purchased an insurance policy. Furthermore, the study describes a need for more inclusive and composite packages of microinsurance products for greater financial inclusion of the poor.