Reinsurance and Other Facilities for the Indian Micro Health Insurance System
FORTE Insurance Journal, Special Issue on Micro Insurance, 2006
9 Pages Posted: 28 Sep 2007
It is increasingly recognized that the economic cost of a risk is greater to the insured than to the insurer, and therefore the transfer of risk can create value for the insured poor. But is there is sufficient opportunity for the poor to transfer risks to insurers? This article identifies some components that could contribute in making this possible. The article discusses the importance of ensuring a fair premium; the cost of reserve capital ("capital loading"); the cost of administration ("administrative loading"); capacity building for MIUs; reinsurance serving the MIUs; underwriting assistance of MIUs; and financial support to the MIUs to defray part of the cost of the insurance premium. The paper concludes with policy recommendations (24 references cited).
Keywords: micro health insurance, social insurance, insurance for the poor, community based health insurance, health financing
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