Social Protection

The Social Protection Working Group aims to increase the knowledge about the different roles of microinsurance within social protection frameworks, and its potential and possible contribution to an enhanced access to social protection.

News

The group met for the second time this year in November at the 7th International Microinsurance Conference in Rio de Janeiro, Brazil.

Annual workplan

In 2011 and 2012, the Social Protection Working Group will:

• Stocktaking of possible roles of microinsurance within social protection frameworks and links between microinsurance and other social protection approaches;
  • Compile database of countries and approaches;
• Landscape Study on microinsurance and social protection in specific countries (tbd);
• Position paper on microinsurance and social protection;
• Guidance Paper on subsidies for microinsurance products (likely in cooperation with Health Working Group);
• Identify founding resources;
• Explore links to other working groups (especially Health WG) and identify joint projects.

Additional information

Households are exposed to a number of risks such as illness, old age, accident, disability or natural hazards. The occurrence of such risks can cause a loss of income as well as unexpected expenditures and thus have disastrous consequences especially for low income households. Families or individuals fall (deeper) into poverty because of catastrophic expenditures and face increased vulnerability due to negative risk coping strategies such as selling of productive assets.  

Social Protection programmes can break this vicious cycle between vulnerability and poverty by providing strategies to manage risks. Social protection programmes are therefore instruments which support households or individuals in the prevention, mitigation and coping of risks. They can be provided by various players such as the state or the government, informal communities of mutual solidarity or commercial insurers.  

In most developing countries, state or government run programmes, referred to as social security programmes, have a limited outreach including only formal sector employees. The majority of the people working in the informal sector are excluded from these social security programmes. Commercial insurance products are often not affordable for them and mutually supportive groups do not provide sufficient protection and traditional structures are further eroding in many societies. Therefore, low-income households often remain unprotected.

Microinsurance is one way to fill this gap. Microinsurance has the ultimative goal of providing social protection, i.e. reducing poverty and vulnerability through the provision of support to low-income households in their efforts to manage risks. But it is just one of several options for reaching this goal and risks can be managed  in most different ways.

Therefore, the potential of microinsurance should always be assessed in relation to other social protection instruments  and within the specific national context. The question which role microinsurance should play within the social protection framework of a country and its potential and possible contribution to an enhanced access to social protection should always be considered.  

Past activities

The Working Group on Social Protection was first initiated in Dakar last year and now officially launched during the Member Meeting in June 2010. The objective was to discuss the strategy and objective of the Working Group and to elaborate a workplan for the following months, as well as identify synergies and overlaps with other Working Groups, particularly Health.

Mode of operations

The core group will meet and exchange frequently. Regular updates on ongoing activities by email. The Working Group will meet or set up conference calls in project specific groups when necessary.