Microinsurance, trust and economic development: Evidence from a randomised natural field experiment in China
Mirrlees Institute for Economic Policy Research, January 2010
This paper is among the first to examine the effects of microinsurance on production behaviour, in the context of hog farming in rural China. Pork meat is an important part the Chinese daily diet, but pork production is very vulnerable to adverse shocks, such as infectious disease and natural disasters.
The paper found that providing access to formal insurance significantly increases farmers' tendency to raise sows. It argues that this finding also suggests that farmers are not previously efficiently insured through informal mechanisms. The study also provides several pieces of evidence suggesting that trust, or lack thereof, for government-sponsored insurance products is a significant barrier for farmers' willingness to participate in the formal insurance programme, despite partial premium subsidy from the government.
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Microinsurance: Innovations in low-cost health insurance
Health Affairs, Vol. 28, No. 6, pp. 1788-1798, 2009
Microinsurance - low-cost health insurance based on a community, cooperative, or mutual and self-help arrangements - can provide financial protection for poor households and improve access to health care. However, low benefit caps and a low share of premiums paid as benefits - both designed to keep these arrangements in business - perversely limited these schemes’ ability to extend coverage, offer financial protection, and retain members.
This paper examines three schemes in India, two of which are member-operated and one a commercial scheme, using household surveys of insured and uninsured households and interviews with managers. All three enrolled poor households and raised their use of hospital services, as intended. Financial exposure was greatest, and protection was least, in the commercial scheme, which imposed the lowest caps on benefits and where income was the lowest.
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Brazilian magazine tackles microinsurance: Possibilidades do microsseguro
The Brazilian financial magazine Revista Opinião has devoted a whole issue to the importance of microinsurance and the opportunities that exist within the sector. The online magazine is in Brazilian.
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Institute of Chartered Accountants of India, 2010
What can help the poor in managing financial risks is microinsurance, says the Institute of Chartered Accountants of India in a recent publication titled ‘Micro Insurance’, which is a useful reference for the accounting professionals.
The ICAI highlights the need for innovative methods to tackle lapses. For example, if the client misses premium, the insurer may deduct the amount from the accumulated value of the policy to keep the cover in force. And, to encourage payment discipline, incentives in the form of lower premium can be offered to those who pay regularly.
Full review in The Hindu, 15 April 2010
5th edition of Micro Insurance Voices published
The latest issue of Micro Insurance Voices, the newsletter of the Micro Insurance Academy (MIA), is now available online. In addition to news from partners and microinsurance in general, this issue provides an update of recent activities:
- Niramaya Health Protection Fund launched in Orissa;
- MIA and Save the Children publish a report on Financial Inclusion Opportunities for Micro Health Insurance in Nepal;
- Interest in microinsurance reaches the Indian North East;
- The Micro Insurance Academy: spotlight on global advocacy;
- Update from the MicroInsurance Network: steady progress in Insurance Education and Impact Assessment;
- Launch of an online survey on the supervision of microinsurance.
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Prosper Issue 7 available
In this latest issue, ICMIF reports on the positive steps taken by the Latin American Reinsurance Group (LARG) to increase collaboration between member organisations, a practical example of cooperative insurers coming together to find solutions to common challenges. Congratulations also goes to SEWA for launching India’s first national women’ insurance cooperative, a significant achievement building on the important work SEWA has been doing for years providing insurance access to low income women and their families.
The cover story highlights the collaboration between two ICMIF members, Développement International Desjardins (DID) and the SANASA Group, to reach nearly 60,000 agricultural workers and their families in Sri Lanka with an effective and accessible indexed-based crop insurance product.
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