Formal Microinsurance in Indonesia - an advantage over informal risk mitigation strategies for low-income people?

Inhaltsverzeichnis (Table of Contents)

• 1. INTRODUCTION
• 2. SCOPE, METHODOLOGY AND STRUCTURE OF THE STUDY
• 3. AN INTRODUCTION INTO MICROINSURANCE
  • 3.1 MICROFINANCE
  • 3.2 MICROINSURANCE AS A MICROFINANCE SERVICE
  • 3.3 THE PRINCIPLES OF PROVIDING INSURANCE
  • 3.4 THE FRAMEWORK FOR MICROINSURANCE IN INDONESIA
  • 3.5 MICROINSURANCE PRODUCTS
  • 3.6 CRITICAL ISSUES FOR MICROINSURANCE PROVIDERS TO EFFECTIVELY SERVE THE POOR
    • 3.6.1 The minimum required pool size
    • 3.6.2 Group or individual insurance
    • 3.6.3 Minimizing transaction costs - possible distribution channels
    • 3.6.4 Setting prices and valuing losses
    • 3.6.5 Protecting against adverse selection, moral hazard and fraud
    • 3.6.6 Claims management
    • 3.6.7 Premium payment
    • 3.6.8 Marketing and market education
• 4. TRADITIONAL RISK MITIGATION OF THE POOR IN INDONESIA
  • 4.1 BACKGROUND
    • 4.1.1 The economic environment of low-income households
    • 4.1.2 Defining vulnerability
    • 4.1.3 Risks poor people face in Indonesia
    • 4.1.4 Risk management strategies
    • 4.1.5 Risk management arrangements
    • 4.1.6 The impact chain of risk events
  • 4.2 INDIVIDUAL RISK MITIGATION STRATEGIES
    • 4.2.1 Diversify income sources
      • 4.2.1.1 Effectiveness and secondary impacts of diversification
    • 4.2.2 Saving up assets and cash
      • 4.2.2.1 The usefulness of different assets and cash
      • 4.2.2.2 Effectiveness and secondary impacts of saving up
  • 4.3 GROUP-BASED RISK MITIGATION STRATEGIES
    • 4.3.1 Reciprocal transfers
      • 4.3.1.1 Effectiveness of reciprocal transfers
    • 4.3.2 Rotating savings and credit associations (ROSCAs)
    • 4.3.3 Accumulating savings and credit associations (ASCAs)
      • 4.3.3.1 Effectiveness and secondary impacts of ROSCAs and ASCAs
• 5. THE MICROINSURANCE SECTOR IN INDONESIA
  • 5.1 DEMAND FOR MICROINSURANCE IN INDONESIA
  • 5.2 THE DEMAND-SUPPLY GAP - THE MARKET FOR MICROINSURANCE PRODUCTS IN INDONESIA
  • 5.3 OVERVIEW OF INDONESIAN MICROINSURANCE PROVIDERS
  • 5.4 MICROINSURANCE PRODUCTS IN INDONESIA
    • 5.4.1 Credit life insurance
    • 5.4.2 Sharia-compliant accident life insurance
    • 5.4.3 Education endowment insurance
    • 5.4.4 In-patient hospitalization plan
    • 5.4.5 Effectiveness and secondary impacts of microinsurance
• 6. INDIVIDUAL AND GROUP-BASED RISK MITIGATION STRATEGIES IN COMPARISON TO MICROINSURANCE
  • 6.1 COVERAGE
  • 6.2 ACCESSIBILITY
  • 6.3 TIMELINESS
  • 6.4 SECONDARY IMPACTS

Zielsetzung und Themenschwerpunkte (Objectives and Key Themes)

This diploma thesis investigates the potential of formal microinsurance in Indonesia to provide an advantage over informal risk mitigation strategies for low-income people. It aims to analyze the effectiveness and secondary impacts of both formal and informal risk management approaches, ultimately determining whether microinsurance offers a viable and beneficial alternative for those living in poverty.

• The role of microinsurance in addressing the financial vulnerabilities of low-income households in Indonesia.
• A comparative analysis of formal and informal risk mitigation strategies, including their effectiveness and secondary impacts.
• The challenges and opportunities for microinsurance providers in reaching and serving low-income populations in Indonesia.
• The impact of microinsurance on the financial stability and well-being of low-income individuals and families.
• The broader economic and social implications of microinsurance adoption in Indonesia.

Zusammenfassung der Kapitel (Chapter Summaries)

• Chapter 1: Introduction provides an overview of the research topic and its relevance within the context of Indonesia's socio-economic landscape.
• Chapter 2: Scope, Methodology and Structure of the Study details the research approach, methodology, and the organizational structure of the thesis.
• Chapter 3: An Introduction into Microinsurance introduces the concept of microinsurance, its principles, and its framework in Indonesia. It discusses the challenges microinsurance providers face in effectively serving the poor, including issues such as pool size, distribution channels, pricing, and risk mitigation strategies.
• Chapter 4: Traditional Risk Mitigation of the Poor in Indonesia explores the informal risk management strategies employed by low-income households in Indonesia. This chapter analyzes the effectiveness and secondary impacts of individual strategies such as income diversification and asset saving, as well as group-based strategies like reciprocal transfers, rotating savings and credit associations (ROSCAs), and accumulating savings and credit associations (ASCAs).
• Chapter 5: The Microinsurance Sector in Indonesia examines the demand for microinsurance products in Indonesia, the market for microinsurance, and the existing microinsurance providers. It provides an overview of different microinsurance products available, including credit life insurance, Sharia-compliant accident life insurance, education endowment insurance, and in-patient hospitalization plans. It further discusses the effectiveness and secondary impacts of microinsurance.
• Chapter 6: Individual and Group-based Risk Mitigation Strategies in Comparison to Microinsurance compares the coverage, accessibility, timeliness, and secondary impacts of both formal and informal risk mitigation strategies, aiming to determine the advantages and disadvantages of each approach for low-income individuals and families.

Schlüsselwörter (Keywords)

Microinsurance, Indonesia, low-income households, informal risk mitigation strategies, traditional risk management, reciprocal transfers, ROSCAs, ASCAs, financial vulnerability, demand-supply gap, microinsurance products, effectiveness, secondary impacts, accessibility, coverage, timeliness.