Analysis of the Microinsurance Market and Its Development Opportunities in Russia

The relevance of the work is supported by the growing share of the population with cash incomes below the subsistence minimum in recent years, as well as the search of authorities for new tools against the poverty. The work has theoretical significance, since it increases a limited number of Russian works on such a topic, and is also practically important, because it helps the authorities and insurers to alleviate social problems and introduce a new product to the market. The aim of this work is to develop recommendations for insurers and government agencies to introduce a new financial instrument to reduce poverty and inequality, which is microinsurance. The research hypothesis is the importance of financial literacy of the population for the development of microinsurance. For a comprehensive analysis of the existing microinsurance market, the methods of work were theoretical, comparative and regression analyzes. An econometric model was built based on data of more than 100 developing countries. The dependent variable was the percentage of the population using microinsurance services, and various macroeconomic and demographic indicators of countries, financial literacy of the population, and the active participation of the authorities were considered as determinants of the microinsurance development. As a result, the hypothesis was confirmed, conclusions were drawn about the importance of technological methods of distributing microinsurance products at a 5% level of confidence, and the proposal to target sales to a female or rural group of potential consumers was rejected. A comparative analysis of best practices in the implementation of microinsurance processes in the BRICS countries also helped complement the recommendations on a focus on life microinsurance products, cooperation of insurance companies with microfinance organizations and the development of a legislative framework for introducing microinsurance to the Russian market.