Microinsurance in Western Asia

Abstract

There are some microinsurance schemes in Western Asia but not many. The question is why? The existence of microinsurance in Western Asia shows that it is principally feasible in this part of the world. And the large range of different products offered by the existing scheme shows that the potential of microinsurance in the region is substantial. Apparently, most different actors can organise microinsurance as both, micro-takāful and conventional microinsurance.However, there are at least five handicaps for tapping the full potential of microinsurance: (i) The microinsurance concept is still very little known throughout the region. (ii) Most NGOs and co-operatives suffer from weak capacities, MFIs have only limited out-reach with the exception of Jordan, Lebanon and Palestine, and in most Western Asian countries, insurance companies do not see a need to turn to low-income earners. (iii) Insurance, co-operative and NGO laws of several countries constitute constraints to several forms of microinsurance. (iv) Commercial companies and third-sector organisations (non-profit organisations being organised by members of society bottom-up) tend to mistrust each other and therefore have difficulties to co-operate. (v) Many citizens continue to expect solutions for their social problems mainly from the government rather than themselves.