Microinsurance-A_Risk_Management_Strategy.pptVIP

Microinsurance: A Risk Management Strategy PRESENTATION INSTRUCTIONS This is a DIRECT presentation designed for microfinance donors. These slides may be used or changed without permission. Attribution to CGAP/DIRECT is appreciated. Slides are accompanied by notes. To view notes, select from the PowerPoint menu: View/ Notes Page. Scroll to advance to next page. To print notes, select File/ Print/ Print what: Notes Pages. To print handouts of just slides (no notes), select File/ Print/ Print what: Handouts. Then enter the number of slides to print per page. For optimal printing on a black-and-white printer, select from the menu: File/ Print/ Pure Black and White. Overview What risks do poor people face and how do they protect themselves? What is microinsurance? What are the difficulties in providing insurance to poor people? What are some microinsurance delivery models? What are some dos and don’ts for donors? What Risks Do Poor People Face? Key Risks Death Illness or injury Loss of property (theft, fire) Natural disaster (earthquake, drought) How Do Poor PeopleProtect Themselves from Risk? Understanding the Demand for Risk-Managing Financial Services Different Financial Services for Different Risks What Is Microinsurance? Protection of low-income people against specific perils in exchange for regular monetary payments (premiums) proportionate to the likelihood and cost of the risk involved. Basic Insurance Principles What Are Some of the Difficulties in Providing Insurance to Poor People? Technical Specialization Requires specialized actuarial capacity, which is complicated by the lack of reliable data characteristic of low-income, informal markets Relative Complexity of Insurance Products Crop insurance Health and disability insurance Annuities and endowment (retirement provision) Property insurance Term life insurance (payment to beneficiaries on death) Degree of Risk in Providing Insurance The Dismal History of Crop Insurance Unspecific Coverage B