Based on Scale2Save partners' case studies, this learning paper explores the challenges for micro-insurance uptake for low-income customers, and presents solutions and opportunities.
the full learning paper
recent state of the sector case study on mobile financial services
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BRUSSELS, 28 April 2021 – Today the
programme launches a new learning paper. It forms part of the learning series
featuring the experience of partners when developing financial products and
services designed for low-income customers. It was written by Scale2Save Local
Technical Specialist Agnès Fall with support from the Savings Learning Lab at Itad.
This paper aims to support learning on microinsurance in
Africa by giving an overview of the sector and presenting examples on how to
successfully overcome challenges related to the uptake of microinsurance while
also taking into account future hurdles related to Covid-19 and its impact.
Microinsurance encompasses insurance products that protect
against shocks faced by under-served, low-income populations in developing
countries. These products are provided in exchange for regular premium payments
proportionate to their incomes, which take into account irregular income flows.
Microinsurers increasingly tailor their products, policies
and delivery channels to the needs of the poor. Policies are often written in
simple terms to include a variety of options such as licensed insurers, health
care providers, community-based organisations, microfinance institutions and
NGOs. In addition, mobile insurance has become increasingly important to reach
While we observe growing demand and access to formal
financial services such as bank accounts, mobile money and credit, the demand
for formal insurance remains low despite the ‘micro-insurance revolution’ in
the past decade.
One of the
questions that Scale2Save tries to answer is to what extent savings contribute
to financial resilience and what would be there right mix of products that adds
value to people's lives.
that Scale2Save partners are serving often experience challenges to manage cash flows, cope
with risks, and raise money to meet large, unplanned expenses. These households
can benefit from using a combination of financial tools to meet their needs. That is why this learning paper explores the mechanisms that might trigger
the uptake of savings-linked health, life or funeral insurance.