Allianz has really nailed its colours to the mast with regards to microinsurance and are thoroughly embracing the potential for it to turn into a huge market. It’s certainly true that those who venture into the microinsurance marketplaces first stand a very good chance of securing a good sized chunk of the business.
In this interview on the Allianz website, Michael Anthony, Head of Microinsurance at Allianz SE, discuss the challenges microinsurance poses and hints at how big Allianz sees the potential market.
Allianz are mainly offering life insurance at the moment but say that they are looking at health and crop insurance next. Anthony cites distribution as the key to making microinsurance profitable and says “we need to work with local structures, local organizations that by themselves have access to the rural population. Those can be NGOs, grass root organizations, microfinance institutions, farming cooperatives, the tea or milk dairy boards, etc.. Organizations that have a daily exchange with the local population. And it’s through working with these organizations that we reach the people at the bottom of the economic period, and this is how we can make microinsurance viable from a financial perspective”.
Challenge wise, Anthony cites the size of the market and making distribution effective and education of the customer base (many will have no real understanding of insurance).
Asked where he sees Allianz microinsurance efforts in five years Anthony says “I would expect by 2020, probably 20 percent of the people that Allianz is providing insurance services to on a worldwide scale will come from this very low income client segment.” That shows you the potential for this market and how seriously major re/insurance players are taking this opportunity.
Read the full article on the Allianz website here.