Liberty Mutual, a US-based insurance provider that has subsidiaries across Asia, Europe and Latin America, has recently started offering health insurance policies to poor people in the slums of Barranquilla, Columbia. Micheal McCord, founder of the Microinsurance Centre, a for-profit organization that designs insurance policies for the poor, stated that while microcredit helps the poor in starting businesses and earning profits, an event such as serious health problem or death in the family can wipe out the profits earned if the entrepreneur is uninsured [1].
The health insurance product offered by Liberty Mutual in Columbia costs COP 3,000 (USD 1.6) per month and provides coverage of approximately COP 3.7 million (USD 2,000) in the case of serious illness. Liberty Mutual also addresses the challenge of collecting premiums by working with the local gas company to include insurance premiums on the client’s natural gas bill. According to a sales representative of Liberty Mutual in Colombia, the quick settlement of claims by the company in the event of death of the insured has encouraged more people to sign up [1].
According to Mr McCord, approximately 150 million people around the world are covered by microinsurance, with China and India representing the largest market share and Brazil, Mexico and Columbia representing quickly growing markets [1].
By: Medha Ravi, Research Associate
About Liberty Mutual:
Established in 1912, and based in the US, Liberty Mutual provides insurance to individuals and businesses. The company operates subsidiaries across Europe, Asia and Latin America. As of 2009, the company has total assets of USD 109 billion.
About the Microinsurance Centre:
Established in 2000 and based in the US, the Microinsurance Centre is a for-profit initiative of MicroSave, a technical assistance, training and technical resource center for microfinance in Africa. The Microinsurance Centre’s activities include research, product development, working groups support and the provision of training in microinsurance. The Microinsurance Centre is a member of the Regulation, Supervision and Policy sub-group of the Microinsurance Network.
Source and Resources:
[1] Global Post: “Colombia: For the poor, a new way to protect against disaster, January 24 2011, http://www.globalpost.com/dispatch/colombia/110117/microinsurance-disaster-health-care?page=0,0
MicroCapital.org story, November 22, 2010: “MICROCAPITAL BRIEF: Munich Re Foundation, International Labour Organization (ILO) Announce Microinsurance Has Potential to Reach 3 Billion People, https://www.microcapital.org/microcapital-brief-munich-re-foundation-international-labour-organization-ilo-announce-microinsurance-has-potential-to-reach-3-billion-people
MicroCapital.org story, December 10, 2010: MICROCAPITAL BRIEF: Aga Khan Agency for Microfinance to Offer Health, Savings, Harvest Insurance to Rural Poor in Tanzania through First Microinsurance Agency Tanzania, https://www.microcapital.org/microcapital-brief-aga-khan-agency-for-microfinance-to-offer-health-savings-harvest-insurance-to-rural-poor-in-tanzania-through-first-microinsurance-agency-tanzania
MicroCapital’s Microfinance Universe profile: Liberty Mutual, https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Liberty+Mutual
MicroCapital’s Microfinance Universe profile: The Microinsurance Centre, https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=The+Microinsurance+Centre
Browse the MicroCapital Universe and add your entry to the wiki at: https://www.microcapital.org/microfinanceuniverse/
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