The suitability of insurance products often depends greatly on individual circumstances. This paper examines the challenges of heterogeneity in a relatively new product, weather-indexed insurance. This index insurance product has been launched in over a dozen countries, with the goal of enabling households engaged in agricultural activity a means to manage risk. Using data from a large-scale field experiment, we build and calibrate a model which accounts for household investment decisions, including the scope for self-insurance via labor markets to (risky) wage work. Our results show that insurance is most valuable to households with reduced access to wage labor, or to those who face wages that are sensitive to rainfall risk. These findings have important implications for areas where index insurance is most effective.

中文翻译：

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瞄准天气保险市场

保险产品的适用性往往很大程度上取决于个人情况。本文研究了一种相对较新的天气指数保险产品的异质性挑战。该指数保险产品已在十多个国家推出，旨在使从事农业活动的家庭成为一种管理风险的手段。使用来自大规模现场实验的数据，我们构建和校准了一个模型，该模型解释了家庭投资决策，包括通过劳动力市场对（有风险的）工资工作进行自我保险的范围。我们的结果表明，保险对于获得工资劳动机会较少的家庭或面临对降雨风险敏感的工资的家庭最有价值。这些发现对指数保险最有效的领域具有重要意义。