MR Microinsurance_2012_03_29.indd - International Labour ...

What is the impact of microinsurance?
and share important information on them throughout their communities. To
improve the impact of policies within a shorter timeframe, microinsurers can
speed the adaptation process in various ways. For example, Gine et al. (2008)
noted that the most quantitatively significant predictor of take-up was the households’
familiarity and prior experience with the microinsurance provider, in this
instance a microfinance institution called BASIX.
3.3.2 Access to services
Microinsurance is believed to have several basic effects in terms of access to
services. Foremost among these is improving policyholders’ and beneficiaries’
ability to obtain covered benefits quickly and cost-effectively, which in turn
theoretically increases service utilization rates. Second, for health-related cover,
higher utilization rates mean potentially better health outcomes, an important
achievement given that healthier people can work longer hours, command
higher salaries, enjoy increased immunity and more easily acquire human capital
through learning. Third, health microinsurers often contract with, or otherwise
encourage policyholders to use, modern medical providers, which is further
believed to bolster health outcomes by enabling them to bypass traditional,
religious and “quack” healers. 9 Since microinsurers sometimes negotiate service
standards with selected providers in advance, place customer advocates in
hospitals, build new facilities and employ skilled personnel for their clients’ use,
they are similarly assumed to facilitate the provision of higher-quality care.
Finally, by improving low-income people’s access to these services, microinsurance
is also thought to increase equality both spatially and between economic
and gender groups. 10
While these effects have been almost exclusively researched in a healthcare
context, they are also applicable to other insured risks. For example, minimizing
waiting times for and increasing utilization rates of veterinary services can be key
aspects of livestock policies.
9 Of 35 health policies assessed by the “Good and Bad Practices” project of CGAP’s Working Group on
Microinsurance, for example, only two – Sri Lanka’s Yasiru and Bangladesh’s Society for Social Services –
are reported to cover treatments offered by traditional practitioners (in this case, Ayurvedic healers and
Bangladeshi “dai” birth attendants, respectively: Enarsson and Wiren, 2006; Ahmed et al., 2005).
10 Spatial equality relates to the accessibility of services for those located at different distances from the
points of service provision. People living closer to a hospital, for instance, might have easier access and
thus higher utilization rates than those living far away – a classic example of spatial inequality. By incentivizing
the most distant clients with lower premiums, transportation subsidies and telemedicine (among
others), microinsurance schemes can correct these imbalances and promote more consistent utilization
across geographic regions.
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