Insurance cos failing to cover poor, allow NGOs in the sector: GoI-supported report
In an unusual development, a Government of India (GoI)-supported report has favoured the NGO model for taking insurance to the poorer sections of the people, stating that since they are aligned with vulnerable communities they can take insurance to them if necessary policy changes are made in the desired direction. The report comes amidst thestrong view
among Indian NGOs that they have to operate in an “increasingly repressive” political environment.
Prepared by a committee set up by the Insurance Regulatory and Development Authority of India (IRDAI), a statutory body tasked with regulating and promoting the insurance and re-insurance industries in India, thereport
regrets, the poor outreach of the sector is there despite IRDAI mandate to existing insurance companies to sell policies to promote insurance coverage among the economically vulnerable sections.
Chaired by Mirai Chatterjee, director, social security team, Self-Employed Women’s Association (SEWA), an NGO registered as trade union in Ahmedabad, the committee says, in 2018-19 micro-insurance – meant to provide “protection” to low-income people against specific perils in exchange for regular premium payment proportionate to the likelihood and cost of the risks involved – was a poor 1.51 per cent for life and 1.46 per cent for general insurance.
The reasons, says the report, include limited sales of microinsurance policies because of the existing insurance companies’ lack of interest, their contention that microinsura....