tailieunhanh - Lecture Micro financing & micro leasing - An Introduction: Lecture 24

The following will be discussed in this chapter: The microagent model: barefoot agents, models of financing inclusive finance, supply and demand, insurance companies face the channels challenge, direct sales, the partner-agent model. | PARTNERS AT THE LAST MILE: INSURANCE COMPANIES Summary of the Last Lecture Insurance Companies Face the Channels Challenge Direct Sales The Partner-Agent Model The Microagent Model: Barefoot Agents The next model seeks to get even closer to clients by turning selected clients into insurance agents. The Microagent Model: Barefoot Agents Due to the Indian government requirements to issue policies in the low-income market, many insurance companies work with MFIs through a partnership model like the one AIG developed in Uganda. The Microagent Model: Barefoot Agents AIG’s Indian affiliate, Tata-AIG, attempted to do the same, but some members of its staff were concerned about the problem of continuity of coverage. The Microagent Model: Barefoot Agents Since most Indian MFIs offer loans but not savings accounts, the insurance policies were in effect only as long as the customer had a loan outstanding. The Microagent Model: Barefoot Agents Customers who were “resting” from credit . | PARTNERS AT THE LAST MILE: INSURANCE COMPANIES Summary of the Last Lecture Insurance Companies Face the Channels Challenge Direct Sales The Partner-Agent Model The Microagent Model: Barefoot Agents The next model seeks to get even closer to clients by turning selected clients into insurance agents. The Microagent Model: Barefoot Agents Due to the Indian government requirements to issue policies in the low-income market, many insurance companies work with MFIs through a partnership model like the one AIG developed in Uganda. The Microagent Model: Barefoot Agents AIG’s Indian affiliate, Tata-AIG, attempted to do the same, but some members of its staff were concerned about the problem of continuity of coverage. The Microagent Model: Barefoot Agents Since most Indian MFIs offer loans but not savings accounts, the insurance policies were in effect only as long as the customer had a loan outstanding. The Microagent Model: Barefoot Agents Customers who were “resting” from credit received no coverage. The Tata- AIG staff believed that life insurance coverage should be continuous and was not compatible with short-term loans. The Microagent Model: Barefoot Agents Tata-AIG then began experimenting with a “barefoot agent” business model. In a move analogous to using small mom and pop shop owners as banking agents, The Microagent Model: Barefoot Agents Tata-AIG trained local women to become salaried representatives, selling and servicing policies to their village neighbors. The Microagent Model: Barefoot Agents The product designers found that the barefoot agent model worked best if the representatives grouped themselves into small brokerages they termed “community rural insurance groups.” The Microagent Model: Barefoot Agents Tata-AIG works with local NGOs to help recruit representatives. This program achieved moderate scale, covering 21,000 rural, low-income, and landless people with term life and endowment insurance. The Microagent Model: Barefoot Agents Costs in