x

We are happy to announce that all trial registrations will now be issued DOIs (digital object identifiers). For more information, see here.
The Impact of Personal Experiences on Insurance Take-Up in China
Last registered on October 17, 2016

Pre-Trial

Trial Information
General Information
Title
The Impact of Personal Experiences on Insurance Take-Up in China
RCT ID
AEARCTR-0001467
Initial registration date
October 17, 2016
Last updated
October 17, 2016 2:27 PM EDT
Location(s)
Region
Primary Investigator
Affiliation
University of Michigan
Other Primary Investigator(s)
PI Affiliation
National University of Singapore
Additional Trial Information
Status
Completed
Start date
2009-06-01
End date
2010-05-31
Secondary IDs
Abstract
This study examines the effect of experience and knowledge on weather insurance adoption. First, we conduct insurance games with farmers, and find that the treatment improves real insurance take-up by 46%. The effect is not driven by changes in risk attitudes and perceived probability of disasters, or by learning of insurance benefits, but is driven by the experience acquired in the game. Second, we find that providing information on the disaster probability has a strong positive effect on insurance take-up. Finally, when subjects receive both treatments, the probability information has a greater impact on take-up than does the disaster experience.
External Link(s)
Registration Citation
Citation
Cai, Jing and Changcheng Song. 2016. "The Impact of Personal Experiences on Insurance Take-Up in China." AEA RCT Registry. October 17. https://doi.org/10.1257/rct.1467-1.0
Former Citation
Cai, Jing, Jing Cai and Changcheng Song. 2016. "The Impact of Personal Experiences on Insurance Take-Up in China." AEA RCT Registry. October 17. https://www.socialscienceregistry.org/trials/1467/history/11239
Experimental Details
Interventions
Intervention(s)
Intervention Start Date
2009-06-01
Intervention End Date
2010-05-31
Primary Outcomes
Primary Outcomes (end points)
(dependent variables below each outcome)


The Effect of Game Treatment on Insurance Takeup

- Individual Adoption of Insurance


The Heterogeneity of the Game Effect on Insurance Take-up

- Individual Adoption of Insurance


The Decomposition of the Game Effect: Changes in Risk Aversion and Perceived Probability of Future Disasters

- Individual Adoption of Insurance

- Risk Aversion

- Perceived Probability of Future Disaster


The Effect of Game Treatment on Insurance Knowledge

- Insurance Benefit Question 1

- Insurance Benefit Question 2


The Effect of the Number of Hypothetical Disasters on Real Insurance Take-up

- Individual Adoption of Insurance


The Effect of the Number of Hypothetical Disasters on Perceived Probability of Future Disasters

- Perceived Probability of Future Disasters


The Effect of Probability Treatment on Insurance Take-up

- Individual Adoption of Insurance

Primary Outcomes (explanation)
Secondary Outcomes
Secondary Outcomes (end points)
Secondary Outcomes (explanation)
Experimental Design
Experimental Design
In order to study the role of disaster experience and knowledge on individual insurance take-up decisions, a randomized evaluation was conducted alongside the introduction of a new weather insurance policy for rice farmers in China by the People's Insurance Company of China. The experiment included two interventions. The first intervention sought to test how hypothetical experience affects insurance demand. Participants were provided with a hypothetical experience regarding weather shocks and insurance benefits by playing an insurance game. During the game, household heads were asked whether he/she would like to buy rice insurance in a hypothetical future year. Participants then played a lottery to determine if they experience a weather-related disaster in that year. After the lottery, participants were asked to calculate their hypothetical income for the year based on the insurance decision. Next, one or three days after the game intervention, each participant was visited and asked whether he/she would like to purchase weather insurance.

(see paper at end of registry entry for additional detail)
Experimental Design Details
Randomization Method
The experiment has a 4 by 2 design.
The first level of randomization consists of four groups that differ in how the insurance
contract is explained to farmers. The second level of randomization consists of two groups
that differ in whether we explicitly inform them about the true disaster probability.

(see figure 2 in paper for graphical representation)
Randomization Unit
individuals
Was the treatment clustered?
Yes
Experiment Characteristics
Sample size: planned number of clusters
Standard errors are clustered by
16 natural villages.
Sample size: planned number of observations
885 households
Sample size (or number of clusters) by treatment arms
Control: 259

- Probability: 24

- No Probability: 235

Calculation: 197

- Probability: 37

- No Probability: 160

Game 20%: 278

- Probability: 28

- No Probability: 250

Game 10%: 151

- Probability: 72

- No Probability: 79
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
IRB
INSTITUTIONAL REVIEW BOARDS (IRBs)
IRB Name
IRB Approval Date
IRB Approval Number
Post-Trial
Post Trial Information
Study Withdrawal
Intervention
Is the intervention completed?
Yes
Intervention Completion Date
May 31, 2010, 12:00 AM +00:00
Is data collection complete?
Yes
Data Collection Completion Date
May 31, 2010, 12:00 AM +00:00
Final Sample Size: Number of Clusters (Unit of Randomization)
(same as planned)
Was attrition correlated with treatment status?
No
Final Sample Size: Total Number of Observations
(same as planned)
Final Sample Size (or Number of Clusters) by Treatment Arms
(same as planned)
Data Publication
Data Publication
Is public data available?
No
Program Files
Program Files
Reports and Papers
Preliminary Reports
Relevant Papers
Abstract
This study examines the effect of experience and knowledge on weather insurance adoption.
First, we conduct insurance games with farmers, and find that the treatment improves real insurance
take-up by 46%. The effect is not driven by changes in risk attitudes and perceived probability of
disasters, or by learning of insurance benefits, but is driven by the experience acquired in the game.
Second, we find that providing information on the disaster probability has a strong positive effect
on insurance take-up. Finally, when subjects receive both treatments, the probability information
has a greater impact on take-up than does the disaster experience.
Citation
Cai, Jing and Changcheng Song. "Do Disaster Experience and Knowledge Affect Insurance Take-up Decisions?" Working Paper, September 2015.