Insurance Against Poverty? The 'New Generation' Agricultural Microinsurance Schemes
Mosley, P.
Journal: Small Enterprise Development, 12(1): 51-58
Publication Date: Mar 2001
Published by: ITDG Publishing
Document Type: Journal Article
What are the latest lessons for microinsurance?
This article examines three schemes in India, Uganda and Ethiopia and the new generation of microinsurance schemes that:- Seek financial sustainability
- Are targeted on poor people
- Contain defences against moral hazard and adverse selection
Finds that much has to be done to diversify the range of risks covered and the range of models. Concludes that early lessons are to:- Design financial sustainability from the start and look for ways of keeping costs down
- Stick to insurable and quantifiable risks and defend against moral hazard - use excesses
- Budget for reinsurance to help liquidity
- Define a contract with the supplier of data on which insurance payouts will be based
- Work out incentives to help market the scheme
- Start on an experimental basis monitoring actual versus expected outcomes
This document is available in hard copy only. Please contact www.itdgpublishing.org.uk for a copy.
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