Life Insurance Corporation, New India Assurance, United India Insurance, and Oriental Insurance will begin offering microinsurance. All four insurers will use microfinance and nongovernmental organizations to act as agents for their services. SEWA and SKS MicroFinance are notable among the forty institutions that have met with the insurers.
The four insurance providers are government owned. Life Insurance Corporation has the widest reach with 2048 branches and 10.1 million insurance policies written in 2005.
SEWA, or Self Employed Women’s Association, began in 1972 as a labor co-operative. In 1993, the Association created SEWA Bank to provide micro-loans to its co-operative members. The SEWA Bank posted a profit of $111,000, total deposits of $13.7 million, and 50,849 loans outstanding in 2003, the most recent year it reported results. SEWA does not report to MIX, the microfinance information clearinghouse.
Established in 1997, SKS MicroFinance has grown its loan portfolio to $20.6 million, according to year end 2005 results reported to MIX Market. In addition, it returned -3.15% on assets of $27.8 million, and had a debt to equity ratio of 640%.
Additional Resources:
1) Business Standard: “LIC, PSU insurers team up for micro insurance foray”
2) Life Insurance Corporation: History of LIC
3) SEWA: SEWA Bank Annual Report
4) MIX Market: SKS MicroFinance
