The effect of wealth and health status on joint saving and insurance decisions

David Crainich

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Abstract: The paper analyzes the propensity to seek protection against health risks through insurance contracts and savings. We propose a theoretical model that characterizes the joint demand for these two risk management instruments when individuals are exposed to a disease that has financial and health consequences. We then establish the conditions under which reduced wealth and deteriorated health have a negative effect on this joint demand. Regarding the specific effect of health status on the propensity to take out insurance and save, recent experimental studies indicate that these conditions are likely to be met in practice, raising the question of financial protection for the most vulnerable individuals.

Keywords: health status; insurance; precautionary savings; health risk (search for similar items in EconPapers)
Date: 2025
New Economics Papers: this item is included in nep-hea and nep-rmg
Note: View the original document on HAL open archive server: https://hal.science/hal-05538857v1
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Published in Annals of Economics and Statistics, 2025, 158, pp.105-124. ⟨10.2307/48845130⟩

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Journal Article: The Effect of Wealth and Health Status on Joint Saving and Insurance Decisions (2025)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-05538857

DOI: 10.2307/48845130

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