New studies on landscape of microinsurance in Sri Lanka & MNOs in Asia released
Mobile Network Operators (MNOs) provided microinsurance coverage through mobile phones to more than 40 million people in Asia, estimates a new study on mobile insurance in the region, carried out by the Microinsurance Network and Munich Re Foundation, based on 2013-2016 data.
“The study is part of a series of microinsurance landscape studies which feed into the World Map of Microinsurance, an initiative mapping the landscape of microinsurance worldwide*,” explains Henk van Oosterhout, Executive Director at the Microinsurance Network. In 2016, the initiative embarked on two studies: The Landscape of Microinsurance in Sri Lanka 2016 and Insights on Mobile Network Operators as a distribution channel for microinsurance in Asia. Both studies will be launched at the upcoming 12th International Microinsurance Conference (12th IMC) in Colombo, Sri Lanka, this November 15.
“In Asia, Technology Service Providers (TSPs) and their partner MNOs appear to drive microinsurance development and not only provide a delivery channel. They are increasingly assuming an active role in branding, marketing, product design, and in front-end relationships with customers,” highlights Dirk Reinhard, Vice Chairman of the Munich Re Foundation which co-published the studies.
According to recent data, there are currently 2.6 billion SIM cards in use across Asia, highlighting the huge potential for growth for microinsurance through this channel. TSP policies across Asia offer coverage for life, personal accident (PA) and health (hospital cash). However, product innovation remains a challenge with most of the microinsurance products having similar features: The majority are voluntary, include loyalty aspects, and are paid through airtime.
The findings of the landscape study in Sri Lanka show that 7% of the population was covered through microinsurance in 2015, with life and personal accident products accounting for almost 98% of the policies issued. “Insurance companies have done well to achieve this level of penetration, but the numbers highlight the significant potential available to close the protection gap in Sri Lanka,” explains Mr Dirk Pereira, President of the Insurance Association of Sri Lanka (IASL), co-host of the 12th IMC.
* Integration of the data from the study “Insights on Mobile Network Operators as a distribution channel for microinsurance in Asia” into the World Map of Microinsurance is expected by February 2017.