September 2013

Spotlight – In international business, almost every market around the world does things in a different way. This often leads to misunderstandings and unfulfilled expectations. However, different does not need to mean difficult and knowledge of the needs and characteristics of specific geographic markets is an advantage to those who are active in the global economy. These articles help you understand different aspects of the insurance industry around the world, enabling those who do business there to feel more “at home, abroad.”

Microinsurance is the protection of low-income people and the term “micro” refers to the low cost of coverage. A general microinsurance contract can cover health insurance or belongings such as a hut, livestock, tools or instruments or it can be a personal accident insurance either on an individual or group basis. Microinsurance is a useful tool in economic development because otherwise, many low income people cannot pay for regular insurance or risk management tools and when a breadwinner can no longer provide for his/her family, that family is vulnerable to falling back into poverty. Risk Management Magazine explains this well at http://www.rmmagazine.com/2013/03/08/the-rise-of-microinsurance/

One will generally find microinsurance in countries such as Burkina Faso, China, Colombia, Egypt, India, Indonesia, Ivory Coast, Malaysia and the Philippines – and many more. There are more than three billion people who survive on less than US$3 a day and they are the people for whom microinsurance was designed. One of the greatest proponents of microinsurance is the World Bank (http://search.worldbank.org/all?qterm=Microinsurance) and one of the most effective vehicles for getting those at risk to be provided with effective insurance and risk management tools is the Microinsurance Network (http://www.microinsurancenetwork.org/network.php).

Microinsurance is not only here to stay, it is gaining awareness and a reputation for filling a gap in the provision of useful financial assistance to the poor and needy. That said, we believe that not enough people take the time to read articles and other publications which discuss many aspects of microinsurance and how it operates. Recently, the Microinsurance Network published an article entitled “Lessons Learned and Good Practices in Health Microinsurance” and we are very pleased to have been given permission to provide a link to this for our readers at http://www.microinsurancenetwork.org/publication/fichier/Microinsurance_Network_Health_guide_for_practitioners_2013.pdf There is a lot of detail here for those who are interested and we strongly recommend readers to take the time to review this. Any questions can be directed to Annalisa Bianchessi, Communications Coordinator at abianchessi@microinsurancenetwork.org