MR Microinsurance_2012_03_29.indd - International Labour ...

56 Emerging issues
Th ese funds and the national health insurance scheme are thus “complementary”
in a very narrow sense of this word, as both would be obsolete for many rural
households in rural Viet Nam without the presence of the other.
In the same way, microinsurance providers could cover the cost of essential
drugs. Social health insurance schemes in many developing countries pay for all
kinds of medical care, but often not for medication, which is particularly expensive.
However, without drugs, many medical therapies are useless. So here again
micro insurance can prove an eff ective complement to other health insurance
arrangements.
Box 2.2 Th e Viet Nam social risk funds
Under the poverty reduction programme, GIZ supports MOLISA in developing
and piloting social risk funds (SRFs) in four communes in Viet Nam. Th eir aim
is to provide relief when certain events negatively impact households in the com-
munities concerned and thus to reduce the vulnerability of the poor.
Th e SRFs are another far-from-perfect example of microinsurance, as they have
been heavily subsidized and therefore are a type of social transfer programme rather than
a microinsurance scheme. However, they are intended to reduce reliance on subsidies
and illustrate how social insurance and other social protection schemes (those fi nanced
both by subsidies and by member contributions) can function as real complements.
Th e SRFs provide death benefi ts if either of a family’s two main breadwinners
dies, and reimbursement of the costs of transporting a patient to hospital and
accommodation and food for one accompanying caregiver.
Th is list of benefi ts is based on target group preferences. Its composition can
only be understood against the background of Viet Nam’s public social insurance
agency off ering a comparatively cheap health insurance product, which covers most
medical treatments, but not travel costs. Th e product is thus attractive for people
living in towns, but less so for the inhabitants of remote areas who would have to
travel a long way to make use of the health insurance package off ered by the State.
Buying it only makes sense in rural areas in combination with the SFR coverage.
Th e SRFs are fi nanced by member contributions, government subsidies and
the fi nancial support provided by GIZ. Currently, about 70 to 80 per cent of the
total cost of running the SRFs is covered by member contributions. Th is might
be the reason why MOLISA and GIZ rightly avoid using the term “insurance”
for these funds. However, contribution rates have already increased signifi cantly
over the last few years and should cover almost all expenditure in the near
future.
Source: Adapted from GTZ, 2009.