Thursday, November 24, 2016
Last Friday 18th of November, the Microinsurance Network took a small party of 20 participants from the 12th International Microinsurance Conference to visit the Cooperative society at Nawagamuwa, Sri Lanka, and find out about the Sanasa approach to cooperative mutuals.
“The concept of mutuality is based on the fundamental premise by the community of helping each other in the event of difficult situations”, explained Imesha, the daughter of the cooperative manager giving a presentation. “It is the basis of the formal insurance mechanisms and processes that are implemented with the help of Sanasa”, she added. Imesha explained that the first poverty reduction strategy applied by their cooperation is microfinance, followed by savings and loans.
Without many assets and resources to fall back on in the event of a peril, the poor are left mostly with informal community mechanisms to cope with their risks. Some of the mechanisms mentioned by Imesha were: Help with food security, support for school fees, income support for elderly members who have been members of the cooperative for at least 40 years, lotteries that provide small prizes (sugar, shampoo & other basic necessities), and beauty contests for young, middle-aged and older women that provide entitlements to small luxury items.
The cooperative has a thorough understanding of the risks and vulnerabilities of its members. They were therefore able to decide which products, out of the 16 different products on offer through Sanasa, are best suited to their members. The coverages deemed most relevant to their members are life, credit-life, disability and health. These products are topped up with additional benefits provided by the cooperative, based on their mutual values, such as a waiver of the repayment of a loan after an accident resulting in disability, and the aformentioned informal mutual support mechanisms.
Field trip participants had the opportunity to meet a member, Mr. Sugith (age 42), who benefitted from the waiver of his loan, as he suffered a permanent disability resulting from a broken leg.
The presentation and discussion were held under typical monsoon conditions. Heavy rains poured on the corrugated iron roof making it hard to hear what was being said. Alas the weather led to extra traffic jams and meant the field trip had to be cut short of the informal meeting with other cooperative members.
In the future, the Microinsurance Network aims to hold more full-day field trips to allow participants ample time for interaction with those at the grassroots level.