Insurance Incentives to Pursue Social Well-Being

Current crisis, causing structural long-term changes in the economy and society, is offering a challenge to the insurance sector, whose primary role lies in the protection of individuals and productive activities. The insurance industry can take this opportunity towards achieving the objective of social well-being with the design of new insurance products and incentives. In this work we propose a particular type of securitization scheme where the health risk in a broad sense is transferred to capital market. For example, this tool can be exploited by firms to cover the risks of damage to the health of workers and office workers. Certain discount policies by insurance companies may encourage activities aimed at improving the health system and the work safety. An appropriate morbidity index is used to price this type of policy. Numerical results are offered and discussed.