Issue Digest-Microinsurance
Issue Digest-Microinsurance
Issue Digest-Microinsurance
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2 | <strong>Issue</strong> <strong>Digest</strong>: January 2013<br />
Executive<br />
summary<br />
01 <strong>Microinsurance</strong><br />
<strong>Microinsurance</strong> provides protection<br />
and risk mitigation; is also a market<br />
with vast potential<br />
02 Increasing<br />
03<br />
04<br />
05<br />
Products<br />
focus on innovating<br />
products that combine consumer<br />
needs with affordable premiums<br />
Distribution<br />
Insurers investing to find the right<br />
mix of distribution channels that are<br />
effective and efficient<br />
Regulations<br />
Countries around the globe rapidly<br />
adopting separate regulations for<br />
microinsurance<br />
Outlook<br />
Good practices emerging, expected<br />
to stimulate further growth<br />
• <strong>Microinsurance</strong> refers to insurance products designed for<br />
people living on low incomes.<br />
• Estimated potential market of about four billion customers<br />
and US$40 billion in premium income per year.<br />
• Credit life is the dominant microinsurance product;<br />
however, health and agriculture insurance are also slowly<br />
gaining prominence.<br />
• Designing need-based products that are affordable and<br />
create shared value for insurers and society remain key<br />
areas of concern.<br />
• Microfinance institutions (MFIs) and cooperatives are the<br />
most-preferred distribution channels; however, the role and<br />
significance of different channels differ across regions and<br />
product segments.<br />
• Governments are trying to step up efforts to provide risk<br />
protection to a wider segment of the population by adopting<br />
favorable regulations as well as requiring insurers to create<br />
insurance awareness among the low-income group.<br />
• The microinsurance industry is expected to witness<br />
significant growth led by increasing insurance awareness<br />
through low cost innovative products and distribution<br />
channels being gradually introduced by the insurers.<br />
Government participation through NGOs, public private<br />
partnerships (PPP) and Community-based Organizations<br />
(CBOs) are also likely to help in the enhancement of<br />
microinsurance and the upliftment of the poor.<br />
© 2013 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG<br />
International. KPMG International provides no client services. All rights reserved.
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