Corina Constantinescu

University of Liverpool

Title

Subsidising inclusive insurance to reduce poverty

Authors

José Miguel Flores-Contró, Kira Henshaw, Sooie-Hoe Loke, Séverine Arnold, and Corina Constantinescu

Abstract

We model the capital of a household from a ruin-theoretic perspective to measure the impact of microinsurance on poverty dynamics and the governmental cost of social protection. We show that although insurance alone (without subsidies) may not be sufficient to reduce the likelihood of falling into the area of poverty, subsidized schemes can provide maximum social benefits while reducing governmental costs.