Sa-Dhan Newsletter Volume 1 Issue 4

Micro-Insurance

certificates were taken with the details of damage,

(c)

Need for assistance in operations: Extra

address and occupation of member.  Intimation of

assistance in filling up forms and guiding them

loss was submitted by members in large numbers at

to the right place has to be provided. Vimo

the insurance office, in SEWA, and SEWA Bank and

Aagewans play this role effectively.

also Collected by SEWA relief team. It was decided to

(d)

Matching of collection schedule with cash flow:

accept claim intimation up to 10 days from date of

Urban poor get small amounts frequently. Rural

heavy rains and this message was conveyed to

poor get lump sums in the agricultural seasons.

members through Aagewans/organizers.

Their cash flow depends on the type of activity

they are involved in. Premium collection systems

The task of surveying more than 1,100 claims was

of the bank should be matched with the cash

handled by five field workers with the support from

flow of its clients.

SEWA's Health and Childcare Teams; Mahila Housing

5. Training needs of the clients should be addressed:

Trust Team, and SEWA Bank. A claims committee was

Women need in depth training as regards the concept

set up consisting of workers and organizers

of insurance, risk coverage, the process of premium

represented by different trades i.e. agarbatti workers,

collection and claim, etc. Lack of knowledge about the

bidi Workers, block printers,  construction workers

required documents leads to the submission of

and vegetable vendors. The Committee sat for more

incomplete papers and information, which results in

than twenty days, daily for 4-5 hours and settled 40-

the rejection of claims by the insurance company.

70 claims a day. The total number of members

Incomplete information includes not informing SEWA,

compensated was 630 and the total amount of

and thereby the insurance company, about any change

compensation was Rs 2, 56,787.

in name or address in case of marriage, or change of

The major earthquake (7.6 on Richter scale) on 26th

residence. Differences in names and addresses make

of January 2001, shook Gujarat affecting SEWA

processing of claims difficult and also cause delays in

members in both rural and urban areas. Members

ascertaining the authenticity of the claimant. Through

were given 25 days to report their losses and the

no fault of their own, insurance companies rejected

mammoth task of survey was started on a war footing.

the women's claims.

A team of 15 surveyors from the various wings of

6. The critical role of the field worker: The field

SEWA like health workers, and Housing Trust workers

worker is crucial to the success of the social security

was constituted. 2,167 claims were field and Rs.

system. The field workers are the link between the

23,55,135 was dispersed as the claim amount.

institution and the field. They assist in the door-to-

SEWA has demonstrated over decades, that insurance

door collection of premiums, verifying the genuineness

for the poor is viable. SEWA holds that poor women

of the claims, careful screening of all documents, and

are insurable and willing to pay for the service, social

checking information by extension work. Recently,

security should be perceived as a basic right, integrated

SEWA has recruited 'Aagewans' who spearhead teams

insurance scheme (covering all risks) which is part of

for insurance work. The social security wing of SEWA

the total financial services should be linked with

works closely with other departments like the savings

savings and credit of the poor women, design should

and loan department of the SEA Bank or the health

be demand led, develop faith and trust in the

cooperatives to educate its members about the concept

institution organizing the services is crucial, gender

of insurance and risk pool.

sensitive design is crucial for the client group, simple

7. Design of the insurance services is demand

and flexible mechanisms are essential, timely

driven: The insurance companies have not yet designed

compensation is critical, capacity building of the client

a different mechanism for dealing with the poor,

group regarding the concepts and practice of

illiterate population and continue using the same

insurance, coverage should be wider.

mechanism which is applicable to the literate, urban,

Finally, the challenges in the sector that need to be

middle class. For instance, while dealing with health

addressed are- 'up scaling' of the existing services of

insurance cases the insurance company defines

the insurance companies, and operating with the

hospitals as those with a minimum number of beds,

unorganized sector workers, so that the poor can be

and a specific kind of certificate for coverage. In

brought under the insurance coverage. Such up scaling

villages where there are small hospitals, which do not

would involve the capacity building of the institutions-

fit this definition, the genuine cases are rejected.

capitalizing them as well as strengthening their links

8. Asset loss- Mechanisms of coping and assessing:

with the unorganized sectors. A committed policy that

The challenge lies in providing adequate mechanisms

reaches and builds the capacity of the workers is

of asset loss estimation and payment to enable faster

needed.  Another option would be to have a

recovery of the clients. As the water receded after the

combination of systems like Tripartite Boards where

cyclone in the second week of July in 200, SEWA saw

governments would work with people's organizations

a stream of members walking in to report

their

at people's doorsteps. It is clear that through

losses. (It was for the first time that SEWA was dealing

insurance, workers especially women can secure their

with a calamity of such magnitude). Photocopies of

lives and plan for the future.

Annual Insurance Premium and Fixed Deposit

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