Transcript Presentation of Mohsin Ahmed - Pakistan Insurance Institute

Microinsurance
Policy Perspective, Trends and key issues
Presentation to
SECP and Insurance Sector Seminar
29 November 2011
Policy Perspective
From a pyramid
Non-Poor
Transitory Non-Poor
Transitory Vulnerable
Transitory Poor
Chronic Poor
Extremely Poor
Microfinance
(Credit, Deposit,
Insurance and
Remittances)
To a Diamond
HNWI
Middle Class
Poor
Responding to poverty: The arsenal
HEALTH
CARE
What to do is, by and
large known and
simple
EDUCATION
MICRO
FINANCE
HOUSING
BASIC
SERVICES
Access
To
Poverty
SIGNIFICANT
REDUCTION
Relationship between Financial Exclusion and
poverty exists…
*Source: : http://maps.grida.no/go/graphic/poverty-by-country-share-of-population-living-under-usd-2-per-day-2004
There is a moderate to strong relationship between GDP per
capita and usage of financial services
Bank Loan per 1,000 adults
Deposit Accounts per 1,000 Individuals
Bank Branches per 1,000 Adults
Insurance Density: Gross Premium per capita
Insurance density in USD$
UK
4,484.4
USA
3,790.2
Pakistan
4.0
Bangladesh
2.5
India
19.7
Brazil
101.1
Kenya
11.1
Argentina
105.4
Thailand
92.1
Sri Lanka
Malaysia
14.2
25.7
Indonesia
15.8
Industry Trends
Trends in credit, Deposits and insurance
90
80
70
60
50
40
30
20
10
0
June'08
Insurance
Deposit Book
Loan Book
June'09
June'10
June'11
Trends in Insurance
Trends in Insurance
Trends in Insurance
Issues/Challenges
Issues/Challenges
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Awareness & Low literacy
High Premium
High Transportation Cost
(Rural)
Product viability
Culture (Low demand for
voluntary insurance
distrust
Diseases high
Consumer protection
MFPs &
Insurance Co.

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Transparency
Cashless vs. cash based
Settlement of claims (time required)
Competition (product pricing)
Volumes required (low cost)
Existing products not meet the need
Product diversification
Marketing difficult then
Credit/Savings
Push Vs. Pull
Late reimbursement of claims
Regulation
Client



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Lack of understanding of microinsurance
Lack of appropriate information
Legal framework not supportive
MFPs agents or brokers
Product diversification
Role of PMN
Advocacy for
a separate
regulation
for MFPs
Awareness
Raising
Campaign
Promote
consumer
protection
Provide upto-date
information
to
stakeholders
THANK YOU…….
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