Low-income earners in Fiji now have the opportunity to cope with financial emergencies and protect themselves against unexpected life events through a specially designed microinsurance product.
Micro Life is an endowment-type microinsurance product providing death, disability, accident and funeral expense benefits to clients who purchase it. Since it is an endowment product, it also returns a large lump sum of cash to the client upon maturity thereby also acting as a tool to help people save money. This is the first ever microinsurance product like this in the Pacific and has been introduced in Fiji by the Life Insurance Corporation of India (LICI).
At the product’s launch in Suva last week, the Acting Governor of Reserve Bank of Fiji Mr. Barry Whiteside welcomed the initiative.
“The product aims to provide low cost life insurance solutions to the segments of society who have up to this point in time, been under served. The product clearly fits with the Reserve Bank of Fiji’s picture of promoting greater financial inclusion,” said Mr Whiteside.
“If low income individuals decide to purchase the microinsurance product, it will certainly moderate the risks and provide the comfort or backing to be more optimistic in whatever they may be doing to pull themselves out of poverty. Microinsurance is designed to help the low income individual cope with financial emergencies.”
The product has been developed by the LICI’s Fiji branch but benefits from the company’s extensive experience with microinsurance in India, and has also been supported by technical assistance from the Pacific Financial Inclusion Programme (PFIP). At the product launch PFIP further announced that it will be providing a small grant to LICI to help build awareness around the product.
PFIP Pacific Financial Inclusion Advisor and Project Manager, Tillman Bruett said the interest in microinsurance in the Pacific was generated after a workshop held at the Pacific Microfinance week in Nadi in 2009.
“Following the microinsurance workshop, potential partners approached PFIP and we worked with a few from Fiji and Papua New Guinea,” said Mr Bruett.
“We know from studies that families can and do work to lift themselves out of poverty over time. But all too often, the death of a family member can erase all of those gains and push them below the poverty line once again. Life insurance can help families avoid that. I hope that employers take a look at this product, particularly those who hire household or part time staff, and consider buying this product on behalf of their employees. It is a great benefit and at a reasonable cost.
PFIP is a Pacific-wide programme helping provide sustainable financial services to low income households. It is funded by the United Nations Capital Development Fund (UNCDF), European Union, AusAID and the United Nations Development Programme (UNDP) and operates from the UNDP Pacific Centre.
For more information: https://www.pfip.org/what-we-do-in-pacific/projects-activities/