Chatterjee, Arup --- "Microinsurance: The Value Proposition at the Base of the Pyramid" [2012] ELECD 173; in Burling, Julian; Lazarus, Kevin (eds), "Research Handbook on International Insurance Law and Regulation" (Edward Elgar Publishing, 2012)

Book Title: Research Handbook on International Insurance Law and Regulation

Editor(s): Burling, Julian; Lazarus, Kevin

Publisher: Edward Elgar Publishing

ISBN (hard cover): 9781849807883

Section: Chapter 19

Section Title: Microinsurance: The Value Proposition at the Base of the Pyramid

Author(s): Chatterjee, Arup

Number of pages: 44

Extract:

19 Microinsurance: the value proposition at the base of
the pyramid
Arup Chatterjee



1. INTRODUCTION
There is improved visibility of financial inclusion on the global agenda today. A keynote
area is the significant commitment demonstrated by government and business leaders
today for garnering efforts towards bringing the uninsured, the unbanked and the
marginalized members of society into the mainstream economy through financial market
development.
Microinsurance is central to the promotion of inclusive financial systems. It is gaining
in popularity and happens to be one of the most significant growth areas in the
development of the insurance sector. Recent evidence from many developing countries
has demonstrated that not only can the poor afford to make small periodic contributions
towards insuring themselves against risks, but that the risks they face are eminently
insurable. Microinsurance is seen as an important tool for expanding financial access by
increasing the ability of the poor to deal with various risks, beyond the combined impact
of microfinance programs, safety nets and existing, informal mutual support systems.
In a sense, microinsurance is similar to providing basic services like sanitation, electric-
ity, or water and therefore is seen as a mantra for poverty reduction and social harmony.
There is indeed a significant demand for a range of insurance products like protection of
assets, lives, health and retirement. Moreover, as today's global poor become tomorrow's
mass market, microinsurance not only represents a mechanism for tackling poverty, it also
offers a potentially new revenue stream, and should be an ...