Derek -- these are interesting observations for sure. But on the one point of loan cover insurance, I'm having a hard time seeing this as a client-oriented product. I get that clients are concerned about loans in the event they die or become incapacitated, but is that a reflection of client need or the result of MFI practices? Let me propose a simple concept -- in the event a client dies or becomes incapacitated, the loan should die too. After all, the loan is a contract between the MFI and the client, not her family. Likewise, a group might be expected to vouch for clients' credit-worthiness, but should they be expected to vouch for clients' longevity as well?
For MFIs that have trouble managing this risk, why can't they buy a group life cover for the loan pool? This should be much more cost effective than doing the same on a per-client basis.
Loan-life insurance is one of the core microinsurance products out there, but honestly, I have trouble seeing it as a client-centric product.
Daniel
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Posted by: danrozas@yahoo.com
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