November 1, 2013
A lack of comprehensive data on microinsurance risks is pushing up the cost of taking out coverage — and thereby slowing growth of the market, says Michael McCord, president of the MicroInsurance Centre, a US-based consultancy.
Actuarial tables are not available for the low-income market in Latin America, meaning that microinsurers play it safe by charging more than they need to, he says.
“Often when people do have actuarial data, it reflects the risks of wealthier people who are going to the hospital, who are getting death certificates. So the premiums start out higher than what they should be and it’s harder for people to purchase. That therefore reflects a less interested market, whic
Latin America’s microinsurance industry is growing rapidly, but with better data, the results could be even more impressive