Logo of Phnom Penh Post newspaper Phnom Penh Post - Micro-life insurance on rise

Micro-life insurance on rise

Micro-life insurance on rise

7 Yum Sophorn

When 46-year-old Than Thol got a $900 loan from Samic Microfinance last year, he took advantage of a little-known and  lengthily worded insurance program called Measure for Economic and Accelerated Development for All, or MEADA.

MEADA provides coverage for families of mostly lower-income borrowers in the case of an accidental death. For an annual payment of $15, Thol is shielded against confiscation of his collateral in the event that he dies before paying off the loan.

“As a bread-winner, the life of my family strongly depends on me,” Thol, a resident of Phnom Penh’s Dangkor district, said yesterday. “If something bad happens to me, I do not want my wife and my four children saddled with debt.”

So-called micro-life insurance is catching on in the Kingdom, according to the small  amount of companies who provide the product.

MEADA began as a pilot project of Samic Microfinance in 2007, bringing in around 700 clients during the initial roll out.

Fast-forward to 2013 and the now independent company is averaging the same number of clients per month, according to MEADA’s executive director, Khem Sary.

Sary told the Post yesterday that more than 16,000 Cambodians have bought basic life and loan protection insurance policies through MEADA.

“The number of clients is increasing from year to year. More people understand how the insurance services benefit their family and [help] avoid vulnerability,” Sary said.

MEADA is not the only micro-life insurance program seeing growing demand in Cambodia.  

Early last year, Prevoir Kampuchea Micro-life Insurance (PKMI), a subsidiary of France’s Prevoir life and health insurance group, began offering policies with coverage ceilings of $5,000 to Cambodians in mostly rural areas and with limited incomes.

Norng Makara, deputy chief executive officer for PKMI, told the Post yesterday that awareness of micro-life insurance is spreading.

After a year of operation, the company has gained more than 1,000 clients. Among them, 50 per cent are  already taking out loans from separate microfinance institutions, he said.  

Makara credits the growth to advertising campaigns and the fact that microfinance organisations are explaining the benefits of the policies to potential customers.

“Cambodia has demand for micro-life insurance services, and we are trying to capture the opportunities,” Makara said. “At least a million people in Cambodia are our target customers, and that number will grow as the Cambodian economy grows.”

According to a recent report from the Cambodian Microfinance Association, about 1.6 million families were using MFI loans as of the end of March.

MOST VIEWED

  • US to ramp up sanctions after ‘flawed’ national polls

    At a press conference on Wednesday, the US State Department announced that it would expand visa sanctions on the Cambodian officials and individuals it deems responsible for “undermining democracy” in Cambodia. At the briefing, spokesperson Heather Nauert reiterated that the department regarded the July 29 elections

  • Final poll results confirm first single-party Assembly

    IN an unprecedented situation in Cambodian politics, the official results of the July 29 national elections have declared that the Cambodian People’s Party (CPP) will take all 125 seats in the National Assembly on the back of it receiving 76 per cent of the votes. The National

  • PM's Bodyguard commander hits back at US

    The commander of Prime Minister Hun Sen’s Bodyguard Unit (BGU) Hing Bun Heang on Sunday dismissed a short video clip that went viral on social media in which he says he is preparing for a war with the United States over its aggressiveness towards

  • Chinese influence to sweep Kingdom?

    Growing Cambodia-China ties have seen the latter’s influence sweep across the Kingdom through increased investments and tourism. The Asian giant has become the leading source of foreign funds in Cambodia, fuelling the construction sector with huge casino and hotel projects. Much of the growth