There are many social and cultural obstacles facing micro-health insurance in developing countries. While disadvantaged communities develop their own solidarity, risk-sharing and planning mechanisms, they remain wary of the concept of insurance. Studies carried out in Tanzania, India and Mexico show that beneficiaries are generally critical of the low-quality services available.

Micro-health insurance was inspired by the concept of micro-financing. There are various models, including community, private, public and public-private systems, all sharing the common principles of advance premium payment and risk sharing. The rise in new technologies offers prospects of simpler procedures and growth in this type of insurance. However, with buy-in, loyalty and ultimately access to care remaining low, micro-health insurance would only cover 5% of the population in developing countries (Lloyds, 2009). In West Africa, and particularly in Burkina Faso and Mali, there are almost 200 mutual insurance companies per country. Yet coverage is still lower than 4% (Burkina Faso Ministry of Civil Service, Labour and Social Security, 2013; Touré et al., 2014).

Available studies focus mainly on the “quantifiable” elements of demand, essentially premium levels and the willingness of households to pay. But a more qualitative approach that highlights the user’s perspective can bring important insights to the analysis, particularly with regard to the quality of healthcare and to social perceptions of micro-insurance. The following three case studies, presenting the reform of a community-based programme in Dodoma, Tanzania, and the operation of state-funded programmes in India and Mexico1, enable better understanding of the challenges facing micro-health insurance.


Tanzania’s micro-health insurance system, the Community Health Fund (CHF), was established in rural areas in 2003. It is a voluntary system based on an annual premium of two to four euros. Although it aimed to reach 60% of households, its coverage has levelled off at around 7%.

There is widespread dissatisfaction regarding the quality of care and reception in public facilities (Kalolo et al., 2016). Patients complain of a shortage of medicines, a lack of diagnostic equipment and long waiting times. The CHF model was restructured to give every member an electronic card entitling them to free healthcare access and to include hospitalisation in the range of care covered. But with services remaining mediocre, patients are still sceptical about the reform. As well as this, the original plan to have a community-managed system, with the particular purpose of stimulating membership (Mtei et Mulligan, 2007), is rarely implemented in practice.

The micro-health insurance offer would benefit by taking inspiration from local culture and solidarity practices. For example, Tanzania has mutual risk-sharing funds called “Upatu”, designed to help beneficiaries in emergencies (such as disease or serious accidents). They are only used to prepare for natural social events (such as funerals and weddings) and not for healthcare, but marketing strategies could try to introduce healthcare programmes as major social occasions.


In India, a national voluntary health insurance programme (Rashtriya Swasthya Bima Yojana, or RSBY) aimed at poor communities and casual workers was nationally established in 2008. In September 2015, it had more than 40 million users, around 3% of the Indian population. Largely subsidised by government authorities at national and regional levels (to the equivalent of 40 eurocents per family per year), RSBY is implemented by private and public institutions, health centres and insurance companies, selected through a tendering process. Implementation varies greatly from state to state. In Tamil Nadu (in the south of India), it is entirely state-funded and users do not have to pay a premium. There is also a profusion of private insurance companies aimed at the middle and upper classes.

Eligible hospitals are selected by tender which should, in theory, guarantee a level of quality. However, in practice, it is very inconsistent. Many facilities suffer from a shortage of equipment and medicines and, as few are eligible, they are quickly overloaded. Staff are sometimes reluctant to welcome new, often illiterate, rural communities, who are perceived as a disruption to their traditional patient groups. Finally, although it has recently been re-evaluated in some states, the maximum payout a family can claim remains lows at 30,000 Indian rupees per year – the cost of a simple fracture.

Patients are prepared to pay for private care, but are extremely reluctant to pay for more generous insurance. In fact, they remain suspicious of the very concept of insurance. In Tamil Nadu, health problems are considered “accidents”; why pay for something that may never happen? Yet these communities are perfectly capable of planning: they undertake sophisticated calculations and long-term projections, usually in connection with social and religious ceremonies. Any surplus money is injected into the social network (as a gift exchange or loan), and this same network is called on for support when needed. What’s more, the principle is made explicit in the terms used to describe these transactions: contributing to a ceremony is not an expense but a saving, while lending to an acquaintance is not a loan but an “investment in people”.

As in Tanzania, communities prefer to invest in their social network rather than paying an insurance premium to a body of anonymous individuals whose actions are, in their view, unreliable.


Mexico’s “Seguro Popular” (SP)2, the public health insurance system established in 2003, hampers the development of a private micro-insurance offer by covering its potential clientele: the informal sector. The SP should be partially financed by its users, especially for higher social classes. In reality, the government subsidises the entire programme, regardless of income.

SP users have access to a package of ambulance and hospital interventions and laboratory examinations. Membership extends to 95% of the population (almost 52 million people) who don’t have access any other social security system.

This state-funded healthcare system is supplemented by a parallel private insurance system, similar to the one in Tamil Nadu, but not as established. However, demand for their products is negligible, mainly because of their high price and low coverage. Although people prefer to use the free SP healthcare service, they are critical of its services for the same reasons we have already seen: inadequate care provision, excessive waiting times and the poor attitude of healthcare personnel. Therefore, depending on the urgency and nature of the care needed, patients combine services. For example, they may use SP for childbirth, child vaccination and monitoring of diabetes, but pay a private hospital to treat accident injuries, or employ a “partera” for postnatal care.3

As in India, rather than preventing healthcare issues, communities prefer to rely on free, state-funded care structures, notwithstanding their deficiencies, and on the mechanisms of family and community solidarity if payment becomes necessary. As membership of SP is free, the insurance concept is intermixed with the principle of solidarity.

Against this background, there is no room for paid health insurance unless it differentiates itself from SP and offers true added value in terms of the quality of care and attention patients receive. In fact, Zurich insurance company tried, unsuccessfully, to develop such an offer in collaboration with a network of micro-financing bodies (Sulmont, 2014).

These three examples show that micro-insurance faces social and cultural obstacles. Clearly, these can only be overcome if the standard of care offered meets users’ requirements, and if local perceptions and solidarity systems are better integrated and taken into account by public authorities. Better links between paid and free methods of accessing care are also crucial.

The studies in Tanzania, India and Mexico show that insurance is not a direct means of improving the quality of care. For African countries, one solution would be to develop insurance systems alongside plans to improve care quality.

Furthermore, the cases of Tanzania and India show that solidarity exists, but that it comes from a social pattern of mutual assistance that is still beyond the scope of micro-insurance developers. Communities must be able to take ownership of their insurance systems, whether they are private, public or hybrid. They must also know their rights. In India, Mexico and Africa, clarifying the different programmes should be a priority.

The examples of India and Mexico also show that overlapping public and private insurance programmes complicates both the range of care offered and, ultimately, the decision to seek care. Obviously, the African continent can learn from these examples. In all the countries studied, public insurance companies or mechanisms exist alongside private insurance. Local communities can only benefit from a more unified vision on healthcare financing policies.


1 The studies in Tanzania and Mexico were conducted by Albino Kalolo and Annabelle Sulmont respectively, as part of their doctoral research. The Indian case study was part of the “Labour, Finance and Social Dynamics” research programme coordinated by Isabelle Guérin at the Institut Français de Pondichéry. All three cases studies encompass a wide range of stakeholders (patients, representatives from insurance organisations and companies, healthcare personnel, government representatives, etc.).
2 “People’s Insurance” in English.
3 A “partera” applies traditional knowledge to support women before, during and after childbirth.

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