Background <p>Healthcare insurance is one of the strategies to achieving universal health coverage and reduce health care inequality among rich and poor households. In line with this goal, the Ethiopian government launched a community-based health insurance program in 2011 to protect rural households and informal workers from catastrophic out-of-pocket medical expenditure that would increase health service quality. However, there is a dearth of evidence on the effect of this program on socio-economic spheres of the community in the study area. This study aims to assess the socio-economic impacts of community-based health insurance through a case study in Gondar Zuria district of Central Gondar Zone, north-west Ethiopia.</p> Methods <p>A concurrent mixed-methods approach was applied, combining a comparative cross-sectional study design for the quantitative section and descriptive analysis for the qualitative part. The quantitative analysis included responses from 407 households, while the qualitative analysis was based on ten in-depth interviews and three key informant interviews (KIIs). Systematic and maximum variation sampling techniques are used to determine the sample sizes of the datasets, respectively. The quantitative data is generated from the responses of households to structured closed-ended questionnaire by trained data collectors. In-depth interviews and key informant interviews are conducted by the authors with tape-recorder to gather the qualitative data. The quantitative data is analysed by propensity score matching method using STATA-14 software. Findings from the qualitative data are generated through descriptive analysis.</p> Results <p>A quantifiable positive association was found between community-based health insurance (CBHI) and welfare on the basis of quantitative data analysis. The results show that insured households have 17% and 20% lower probabilities of experiencing catastrophic health expenditure and labour absenteeism in the workplace, respectively, compared with non-insured households. Insured households are also more likely to have better vertical social capital compared with non-insured households.</p> Conclusions <p>Thus, the study concludes that community-based health insurance improves both economic and social status of insured households in the study area, and hence, the program should be scaled-up to include more non-beneficiaries to improve welfare in Ethiopia.</p>