Logo of Phnom Penh Post newspaper Phnom Penh Post - Micro-insurers eye rural poor

Micro-insurers eye rural poor

Micro-insurers eye rural poor

Although private insurers hope to capitalise on Cambodia’s untapped rural insurance market, some insiders say the industry lacks regulation and may outprice the Kingdom’s poor.

Fewer than three per cent of rural Cambodians have insurance, Ministry of Economy and Finance data shows.

Micro-insurers, who offer low yearly premiums to rural residents, say the gap in market penetration would attract investment.

“We see a lot of potential for micro-insurance in rural areas. It’s an untapped market,” Ngeth Chou, a representative of Kampuchea Micro Life Insurance, said yesterday at a United Nations Development Program workshop on micro-finance.

“If we have one million clients and collect 12 or 15 per cent, it is good. It is a big market.”

Kampuchea Micro Life Insurance, which will partner with a local micro-financer, hoped to launch next month, Ngeth Chou said, although he declined to give a figure for the company’s yearly premium.

There was more to micro-insurance than business interest, the UNDP said. The practice provided relief for low-income households by increasing their capacity to cope with sudden hardship caused by death, illness or sudden loss of property, it said.

“Micro-insurance decides whether children stay in school,” Mayur Ankolekar, a representative with the United Nations Capital Development Fund, said. He added that crises in rural families often resulted in children being pulled from school.

Until recently, micro-insurance projects had operated as disparate “pilot” programs, Bou Chanphirou, deputy director of the Ministry of Economy and Finance’s Financial Industry Department, told the workshop.

The industry lacked the regulatory framework and quarterly reports needed to assess the fiscal viability of insurance decisions, and had only begun issuing licences to micro-insurers in June, Bou Chanphirou said.

“I am not sure the private sector can sell to rural people,” said Dann Chhing, a project manager at non-profit Community Based Health Insurance, which is overseen by Cambodia’s Department of Health.

Built-in operational costs in private businesses would be passed on to consumers, ultimately resulting in higher premiums, Dann Chhing said.

He said government efforts to insure Cambodia’s rural population focused too much on private insurers.

Dann Chhing said his program offered yearly premiums at US$2.50.

Although the government issued licences, permanent regulation was still void pending the approval of a law on insurance, Bou Chanpirou said.

MOST VIEWED

  • Government hits back at threats to pull EBA, suspend UN seat

    The spokesman for the ruling Cambodian People’s Party (CPP) has said the government is in no way concerned after the European Parliament gave it three months to reverse what it called the “systematic repression of the political opposition”. Ignoring the ultimatum could mean facing

  • Chinese influx pushing locals, Westerners out of Preah Sihanouk

    Some within the Kingdom’s tourism industry have speculated that the recent influx of Chinese visitors may hinder domestic tourism as the price of accommodations in the coastal city of Sihanoukville continues to rise. Preah Sihanouk province, which has become a hotbed for Chinese investment

  • Sar Kheng: Sokha requested security

    Interior Minister Sar Kheng on Sunday revealed the story behind the transfer of former opposition party leader Kem Sokha from Trapaing Phlong prison in Tbong Khmum province to his house in the capital. Speaking at the ruling Cambodian People’s Party (CPP) headquarters in Prey

  • Chinese living in Kingdom more than doubles since ’17

    The number of Chinese nationals living in Cambodia this year has increased to more than 210,000. The figure rose from last year’s 100,000, the newly appointed Secretary of State Sok Phal confirmed yesterday. He said: “Of the 210,000, more than 78,000 are living in Preah Sihanouk [province], but