MICRO-INSURANCE UNDERWAY - PIA
MICRO- INSURANCE which will allow people in the informal sector save for retirement are currently being developed by players in the pensions industry.
Pensions and Insurance Authority (PIA) Communications Manager, Doreen Silungwe, said the initiatives were meant to provide pensions plans for the low and irregular income earners in an economy
Responding a press query, Ms Silungwe said micro-insurance was more affordable and aimed primarily at the developing low-income workers, especially those in the informal economy who tend to be under-reserved by the mainstream insurance. "With an informal economy of about 68 per cent, there was need to provide a pension plan that was tailor-made to this special group of employees," she said.
Ms Silungwe explained that industry players would be direct engagements with various segments of the population including marketeers, drivers, famers, and teachers.
She explained that the introduction of micro-insurance was targeted at local income earners.
She also said: “In increasing insurance uptake the PIA and insurance industry have been working on increasing awareness on insurance, the importance, benefits and the products available on the market,” she said.
"This is done through various activities including radio programmes, engagement of pupils and students so that they begin to appreciate the importance of insurance at an early age."
In 2020, PIA issued the Micro-insurance Principles and Guidelines aimed at promoting good and sound business practice in the micro-insurance sub-sector.
Commenting on this, Ms Silungwe said the guidelines were a significant milestone in the insurance industry as they are helping the industry to develop micro-insurance products within a framework.
Ms Silungwe indicated that micro-insurance businesses are required to comply with these principles by tailoring products that are simple, inclusive ent-centric.
“This means that micro-insurance products must be specifically designed to reach low¬ income market segments.
“Processes and documentation should be stated in simple terms, written in simple English or appropriate local language with no fine print and customised to facilitate easy uptake by targeted clients regardless of income level,” she said. and cli