The effect of air pollution on defensive expenditures: Evidence from individual commercial health insurance in China.

To mitigate the substantial losses incurred by air pollution, individuals undertake defensive behaviors in the form of health insurance expenses. Leveraging data from the 2011-2017 China Household Finance Survey (CHFS) encompassing 3033 residents, we estimate the causal impact of air pollution on defensive expenditures. Our findings are as follows: (1) Air pollution exhibits a significantly favorable effect on individual commercial health insurance expenses, with a 1% increase in PM concentration correlating to an 11.