Micro Insurance in India: an analysis of the perceptions, problems and opportunities


Micro Insurance in India: an analysis of the perceptions, problems and opportunities


Srijanani Devarakonda

Associate Professor, Accounting and Finance, Vignana Jyothi Institute of Management, Hyderabad


International Journal of Trade and Policy

India is a country with a population of 1.2 billion. It is estimated that 37% of the total population live below poverty line (BPL). Social security for BPL people is a matter of concern for the nation. To answer the question, why should the poor insure? We should have answer for the questions like, what happens when a poor family’s breadwinner dies, when a child in a disadvantaged household is hospitalized, or the home of a vulnerable family is destroyed by fire or natural disaster? Every serious illness, every accident and every natural disaster threatens the very existence of poor people and usually leads to deeper poverty. That’s where “microinsurance” comes in.
To cope with the risks such as health problems, crop failure, loss of livestock, death of a family member, loss of asset, income and employment is much harder on the part of poor and low- income groups than others. Many poor households involve in activities of smaller scale but carrying higher degree of risk and uncertainty. The objective of the present study is to examine different risks faced by the poor and low-income groups, their current coping mechanisms. The present study aims to analyse outreach of microinsurance because of its increasing popularity. The study identifies the problems and issues relating to microinsurance such as product design, pricing, claim settlements. It also studies the gender specific demand for micro insurance products in India. The study attempts to suggest the ways in which microinsurance services can become more inclusive to enhance risk management capability of the poor. The study attempts to indicate that access to microinsurance by the poor and disadvantaged population can contribute significantly to the achievement of the development goals of the country, particularly the goals of eradicating extreme poverty and hunger, promoting gender equality and empowering women.


Keywords: Micro Insurance, risks, problems, poverty, outreach, gender specific demand

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How to cite this article:

Srijanani Devarakonda. Micro Insurance in India: an analysis of the perceptions, problems and opportunities. International Journal of Trade and Policy, 2018,1:1. DOI:10.28933/ijtp-2018-02-2801


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