MIRERC 052/2025: Beyond Demographics
Mapping Behavioural Readiness for Insurance through Lab-in-Field Methods
Abstract
Executive summary
Despite growing access to insurance in low- and middle-income countries, a significant portion
of the population remains uninsured, even when affordable products are available. Traditional
targeting approaches based on demographic, occupational, or income-related indicators have
proven insufficient in explaining or predicting insurance uptake. These methods often fail to
account for the behavioral and psychological processes individuals navigate when making
decisions about whether to insure against future risk.
This proposal outlines a study that takes a behavioral approach to understanding insurance
uptake. It focuses on how individuals perceive risk, plan for uncertainty, and allocate financial
and social resources when facing potential loss. The study hypothesizes that insurance decisions
are deeply shaped by behavioral traits such as risk aversion, trust, locus of control, and emotional
responses to past shocks rather than just economic ability or demographic profile.
The study will use a lab-in-field experiment, in which 400 participants from diverse urban,
peri-urban, and rural settings in Kenya will engage in a simulated insurance decision-making
game followed by a psychometric survey. Participants will face a series of structured choices
involving real monetary stakes to reveal their willingness to transfer risk under different
conditions. These game-based decisions will be combined with survey data to identify behavioral
segments that share similar attitudes and patterns. Once we conduct the lab experiment, we will
carry out a follow-up qualitative study which will help us describe the segments.
The aim is to move beyond conventional segmentation and instead identify individuals who are
behaviorally “insurance ready.” The findings will generate actionable insights into the behavioral
drivers of insurance uptake and enable more effective design, targeting, and delivery of insurance
products and outreach strategies especially among underserved or mischaracterized groups.
