MR Microinsurance_2012_03_29.indd - International Labour ...

Teaching elephants to dance
Realizing value from partnerships
Working with partners allows the insurer to extend the existing relationships,
infrastructure, physical footprint and contact points that the partner has with the
low-income market. Th is facilitates the sales process, effi cient collection of premiums,
communication with policyholders and payment of claims. Th e partner
may perform some functions on behalf of the insurance programme such as the
administration of policies and premium collection, especially if it already has systems
for collecting money from customers (see the Aseguradora Rural example in
Chapter 18). Insurers may even work with several partners that perform diff erent
functions, for example, one partner to sell and distribute policies and another to
administer the business.
Working with partners can also encompass developing and implementing
improvements to microinsurance initiatives. Partners, which usually have more
direct contact with the market, can provide valuable feedback to the insurer on
benefi t design, operational processes and customer satisfaction. Active partner
participation and ownership seems to produce better results, but places more
pressure on the insurer to demonstrate and deliver value. Insurers that fail
to respond risk having to shelve or redevelop products if partners are not
satisfi ed.
Trust in the provider of insurance is important; however, it is often the partner
that has the relationship with the client. Th e insurer must therefore ensure that
the partner has a good reputation and is trusted by the market before entering
into a cooperation arrangement (see Box 19.13).
Box 19.13 Image and reputation of partners
Metropolitan Cover2go formed a partnership with spaza
shops, small informal
retailers in the local communities, to distribute funeral insurance. Although
these local retailers were easily accessible to low-income households, the insurer
eventually learned that they had a fl y-by-night image and the target market was
reluctant to purchase insurance from them. Th e insurer later entered into a rela-
tionship with a national retailer; although these outlets were less accessible to the
market, the national retailer had a more trusted brand and stable image in the
market, and greater success with sales.
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