November 25, 2017
Good morning ladies and gentlemen, the Pacific Financial Inclusion Programme is pleased to be involved in the official launch of the bundled microinsurance product, the first of its kind in the Pacific.
With Pacific Island Countries having some of the lowest insurance penetration rates in the world, we are indeed excited about the 12,500 farmers who have received insurance coverage for the first time. This is a big step in the financial inclusion push and we acknowledge and are grateful for the persistence and determination of Fiji Care Insurance and the Fiji Sugarcane Growers Fund in making this possible.
These enrolments mark an important step towards expanding sustainable financial inclusion. For the farmers, enrolment in the insurance scheme is the beginning of a journey that gives protection and that generates tangible value as they use the service and improve their daily financial lives.
Though launched only a few months ago, from the 28 claims already processed and paid out, we can already see that the farmers are benefitting from the insurance and are using payouts to assist with funeral expenses, medical expenses and in their rebuilding damaged homes.
Over the past two years, PFIP has been engaging with the Reserve Bank of Fiji and the Inclusive Insurance Working Group to develop inclusive insurance and work towards an industry led consortium of insurance companies providing bundled insurance. Much work was done by the Working Group and research studies were carried out, different types of insurances were tested and various business models were looked at. Though this did not result in multiple insurers providing the insurance, this group effort played an important part in supporting Fiji Care’s willingness to move forward and provide this bundled insurance.
Prior to this product being made available, Fiji lacked appropriate and affordable insurance products for clients in the low-income segment. Insurance is an important financial service needed to help people manage risks, and help deal with the sorts of financial shocks that can arise from certain events. So appropriately designed insurance can be a useful tool for people to use within a wider risk coping strategy.
This new insurance product that is covering sugarcane farmers, is a great product that can be taken up by any industry or sector, or low-income earning group. The insurance only costs $52 a year for each person – just one dollar a week. I’d say that this is affordable to almost all Fijians. The insurance is also easy to use and uses procedures that make it simple for clients to sign up and get the cover, and to report claims and get settlements.
PFIP is extremely proud to support Fiji Care. We are excited about the possibilities of reaching a lot more people with more enrolments in other industries in Fiji. We encourage our partners to continue to work with us to innovate and try to improve or launch new products, services and solutions that can create better livelihoods for Pacific Islanders.
This project is one of PFIP’s many regional efforts to try to increase the use of financial instruments and especially insurance based products that can help to improve levels of resiliency. PFIP has partnered with the Regional Disaster Resilience in the Pacific Small Island Developing States (RESPAC), a UNDP-Russia funded programme, and we will continue to look at ways to help individuals, businesses and others to cope with disaster related risks and fund post disaster recovery efforts.
Of course, none of this would be possible without the support of our core funders, the Australian and New Zealand governments, the European Union and the United Nations Capital Development Fund and United Nations Development Programme, who continue to believe in our vision for financially-inclusive Pacific.