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Grantee
Seguros Futuro is the first and only cooperative insurance company in El Salvador - a member of the Federation of Savings and Credit Cooperatives (Fedecaces). The company was developed based on the strategic transformation of Fedecaces' life insurance department into a Cooperative for Insurance Services that started operating in 1996. The insurer's mission is to offer family and asset protection through accessible products, including microinsurance, and to promote the social development of its members.
The company is authorized by the Insurance Companies law and supervised by the Superintendencia del Sistema Financiero (the financial system regulatory body - SSF) and the Salvadorian Institute of Cooperative Promotion (INSAFOCOOP). Seguros Futuro receives technical assistance from the Cooperative Society for International Development (SOCODEVI) and is a member of several international associations including: the Americas Association of Cooperative/Mutual Insurance Societies (AAC/MIS), the International Cooperative and Mutual Insurance Federation (ICMIF), and the Latin American Group of Reinsurers (LARG).
Project Summary
- Project name: Enhancing access to microinsurance among remittance recipients
- Project start date: June 2009
- Duration: 3 years
- Country: El Salvador
Beneficiaries
Seguros Futuro members are generally from the lower middle to low-income sectors in both urban and rural areas of El Salvador. The project beneficiaries are individuals who receive remittances that they withdraw from cooperatives or the service points of Seguros Futuro. On average, beneficiaries receive less than USD 300 per month in remittances from family members who have emigrated, mainly to the United States or Canada.
At the end of the three year period, between 10,000 and 15,000 people will benefit from insurance coverage and more than 15,000 additional people will receive education in risk management.
Project Description
The project has the following three objectives: a) To foster a risk management culture in families receiving remittances, principally through education about the use of savings and insurance; b) To introduce an economically accessible microinsurance product that responds to the needs of remittance recipients in the event of the death of the migrant worker; and c) To provide savings and loan cooperatives and MFIs with adequate instruments and processes for them to sell and service microinsurance for their members.
Key Challenges
- The decrease in remittance payments being channeled through cooperatives as a result of the international financial
crisis may affect the capacity of these organisations to offer microinsurance to their members.
- Convincing the majority of savings and loans cooperatives to include microinsurance in the range of services that they offer.
- Achieving better insurance awareness among cooperative members so that they are able to consider insurance as
an instrument to reduce their vulnerability and improve their standard of living.
Learning Agenda
- To what extent do migrant workers and remittance recipients value the life insurance that is offered?
- Is microinsurance a sustainable and adequate risk management tool for reducing vulnerability in the long term,
throughout different stages in the economic cycle?
- Will technology allow for a significant improvement in access (sales) and persistency (renewal) of microinsurance?
Is technology a fundamental factor for increasing the effectiveness and efficiency in the service that the
insurance company offers to its clients?
- How effective is consumer education compared with traditional marketing approaches?
- How can the insurer develop an effective supply process for microinsurance through cooperatives that offer
financial services?
More information on the project
Website of the grantee:
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