Welcome to the Public Awareness column prepared by the Reserve Bank of Fiji. This week’s article introduces some discussions on micro-insurance and the need to develop more appropriate financial products for the poor and a more inclusive financial system.
Risk is a fact of life that we all have to live with. But how each one of us manages these risks can be quite different. A common form of risk protection is insurance. Insurance provides individuals or businesses with a buffer against the adverse outcome of a perceived risk(s). Insurance, however, is not always accessible or affordable to everyone. In many countries it is generally the salaried income earners, middle class and the wealthy who are insured. The poor, rural dwellers, small businesses and irregular wage earners often do not get covered by insurance because, (1) they have other pressing “bread and butter” issues to worry about, (2) they are not aware of the availability of these products and (3) they cannot find affordable insurance products to suit their needs.