The Reserve Bank of Malawi (RBM) has urged insurance companies in the country to come up with micro-insurance products which can be easily used by low-income households.
Speaking during the official launch of a ‘Three-for-Free’ insurance product by Airtel Malawi in partnership with Micro Ensure and Nico Life Insurance Company, RBM deputy governor responsible for Supervision, Grant Kabango, bemoaned the limited existence of micro-insurance services in the country.
While the risks faced by the poor are no different from those encountered by others, Kabango said low income groups of people are more vulnerable to such risks due to their limited resource base.
“They therefore face a greater financial burden when they experience unexpected events.
He said there is scope for micro-insurance to develop in Malawi due to the existing demand for protection against health, life, education, financial and disaster risks.
Kabango said the central bank believes that promoting micro-insurance is an investment for the future which needs a collaborative approach from different stakeholders.
On his part, Airtel Malawi Chief Executive Officer Heiko Schlitke said the introduction of the ‘Three-for-Free’ insurance product is aimed at allowing Airtel subscribers to cushion themselves against uncertainties which may befall them.
“This product offers all Airtel customers life, accidental permanent disability and hospital cash cover by recharging an accumulative amount of K500 or more on Airtel without any extra charges or fees to the customers,” he said.
Nico Life Insurance Company Chief Exective Officer, Osman Karim, said even though insurance is essential to everyone, low-income Malawians especially those in rural are as have not been able to access it through the traditional methods where an agent would be sent to a community.
He said the mobile technology insurance is affordable and will give these low-income people hope in moments of crises, said Karim.