Case Study

Learning from Micro Insurance for SHGs of Pragathi Gramin Bank Chitradurga Unit (PGBCU) in Karnataka

How can micro-insurance be effectively provided for self-help-groups?
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This note attempts to present the experiences of Pragathi Gramin Bank, Chitradurga Unit (PGBCU), in Karnataka, India, in implementing a micro-insurance product called Sangha Kshema Vima Yojana (SKVY). The note presents information on:

  • PGBCU and the introduction of SKVY;
  • Its features and its implementation;
  • The outlook for renewals and the potential for inclusion of new members;
  • The performance of SKVY in the first year;
  • Another product offered by a competitor.

The note lists the following lessons learned from the study:

  • There is a need to de-link life and health insurance from educational scholarship;
  • Revenues generated by the project are not covering costs fully and there is a need for a new revenue model;
  • The expectations generated in the minds of the self-help-group (SHG) members are high; these expectations are not matched with appropriate awareness about the benefits and limitations of the insurance product;
  • SHG members are exploring alternate schemes with different insurance companies and are able to benefit from the resultant competition and increased choices.

The report concludes by stressing the importance of:

  • Sharing experiences;
  • Creating awareness about micro-insurance among SHG members;
  • Capacity-building and training for service providers;
  • An appropriate micro-insurance product;
  • A suitable management-information system (MIS).

About this Publication

By Kanitkar, A.