Non-market insurance and intrafamily transfers

Abstract

This paper investigates the possibility that transfers of money between household members arise because a family member wishes to pay another an insurance premium in exchange for the right to collect an insurance coverage if a loss is suffered. The motive for the transfers is known as non-market insurance, and it is compared with altruism, bequests, and child-services-for-money (ABC). Some empirical evidence for non-market insurance is found based upon the panel study of income dynamics.