Understanding the Moderating Effect of Altruistic Behavior on Support for Social Insurance in India

The insurance sector has grown tremendously over the years and has a huge potential toward the workforce employed in the unorganized sector. India needs comprehensive social insurance schemes to benefit the workers in this sector. The present study is an attempt to examine the impact of risk aversion on support for social insurance schemes in India with the mediating effect of redistributive preferences. The current study is survey-based research. A non-probability sampling technique has been used to collect data from 417 respondents residing in the North-east region of the capital city, Delhi. The data was collected between October 2023 and February 2024. The present study employs structural equation modeling and Hayes' PROCESS Macro module. Results show that risk aversion positively influences redistributive preferences and support for social insurance schemes. The effect of redistributive preferences on support for social insurance is also found to be positive and significant. The moderated mediation effect of redistributive preferences on support for social insurance is also found to be significant. As social security programs are funded by redistributing income through higher taxation policies, individuals with higher risk preferences may opt for such insurance programs. The study will help social groups and policymakers design the schemes in a way that can benefit those working in the unorganized sector at large. The present study has been an attempt to empirically understand the importance of risk aversion and altruism in support of social insurance programs.