SAVINGS-LINKED INSURANCE PRODUCT-AOKUNGU

• The product leverages goal setting and “coaching” as a tangible / regular value offering

• From the savings collected, a monthly insurance premium is deducted for the “big risks” that might derail a business or family

• Cash bonuses (or alternatively some other form of regular and tangible benefits such as discounts on school stationery or clothes from an approved chain of stores) are rewarded for meeting your savings goals for all three months within a school term. 

Alignment with risks  needs and customer value

Risk;                 Customer consequences;                    Insurance Solution;

Fire or storm damage to business- Damage to building and content + Loss of income-Property Assistance +Business Interuption Cover

Death -     

Loss of income due to death of member,spouse or children-Life Cover

Millions of low-income people living across the West Africa want a safe place to save… but can't. Low-income individual can access a loan quite easily. But a savings account? Forget about it. Due to an age-old regulation in almost every country in the region, microfinance institutions (MFIs) are prohibited from offering savings to clients. Major instution as world bank has been advocating for financial institutions to go beyond credit in their product offerings for the low-income population. Not everyone is an entrepreneur so a savings account can be a push for inclusion . Not only does a savings accounts allow a financial institution to serve client's multiple needs, it also allows them to tap into an incredible market opportunity.

 Monthly premium will be deducted form savings deposit. MFI will collect that premium and transfer it to its insurance partner on a monthly basis. After a certain number of years - agreed upon by the client and MFW  the client will receive not only the total amount that she has 'saved' over the years, but also “interest” that comes from the profits of the insurer investing these deposits.
 

In addition to this, you need to know more about it.

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We must of course recognize that this product is not for everyone. A significant portion of MFW's clients and their families hardly have enough income to get by — let alone to save. However, research revealed that most clients do, in fact, use piggy banks to either accumulate funds for a specific payment or to store loose coins for near-future use. Furthermore, an estimated 40 percent of MFW's entire client population participate in rotating savings groups, called Jim'ayya, for things ranging from basic needs (like clothing or school fees), to purchases for the household or business (like a washing machine or even a car). This mechanism allows clients to save money out of sight, with the plan to receive their lump sum payout in a specific month, provided all participants keep up with their monthly share. However, the informal sectors have current savings mechanisms through "chama" like in kenya which the product might suit.

Savings-Security.Informal sectors workers  either never achieve their long-term goals or meet their goals at the cost of acquiring additional debt. Younger clients, in particular, often aspire towards things that are feasible to reach within their lifetime like, downpayment on a house or sending their children to university. However, prioritizing their children's needs can mean that an aspiring shop owner is never able to put enough savings on the side to launch her business.
 Savings-linked microinsurance is a third savings option to help clients reach their long-term goals. 

 

In addition to this, you need to know more about it.