In many of the developing nations, the urban development is happening at a quick pace, but the rural sector is almost left the same underdeveloped way. This is largely due to the low penetration of the financial products and services to the other end. It is a fact that majority of the rural population in Africa and in Asia still face intense poverty.
Those who live in cities and suburban communities have easy access to various financial products and aids such as life insurance, health insurance, auto insurance, property coverage etc. However, people who live at rural area don’t have any access or awareness about such products and also are educationally backwards to identify its scope.
Developments in rural insurance
However, for the last few years, many of the banks and other NGOs, in collaboration with the local governments are working closely towards the development of rural economy. Banks provide various specialised and lenient rural insurance policies, which are customised based on the needs of rural population.
As agriculture, farming, fishing etc. are the major revenue sectors in rural areas, with which the life of the people are closely linked with, the insurance packages mostly centred around these. There are also government-run health and wellness schemes out there, which are meant to ensure better quality healthcare to the poorest people. Now, rural insurance providers also offer policies for health, motor, property, and other things with special consideration to people living under the poverty line.
Special features of rural insurance
- With health insurance, the poor population of the rural regions get a choice to select between public or private hospitals for better healthcare services.
- Intermediaries as non-government organisations and micro-financing organisations can effectively involve in promoting rural insurance by offering education and services to get all class of people covered under insurance.
Rural insurance policies
Farming is one of the riskiest area for rural people to handle, and there are various insurance products to protect the interest of farmers who make a living with it. By having an adequate insurance policy, the farmers can cover variety of their potential risks as farm equipment, livestock, buildings, and work interruptions.
Similarly, the needs of those who are engaged in fishing or other traditional jobs may also vary and insurance providers come up with different policies to fit to the needs of all. Some of the other such insurance policies are for;
- Livestock as cattle, goat, sheep etc.
- Sub-animals such as honeybee or silkworm.
- Horticulture and plantation such as rubber, grapes, orange, condiments etc.
- Equipment and property as agricultural pump sets, farm vehicles etc.
- Rural small-scale business assets as shops and other entities.
- Home insurance.
- Personal motor vehicles, boat, tractor etc.
- Personal coverage as workplace accident or death.
Importance of rural insurance in developing nations
The villages of developing nations act as the strong backbone for the existence of the cities and industries by deciding the growth potential of a nation. Not just food grains, but other essentials such as raw materials or even water supply is being initiated from these rural destinations. So, any flaws to this rural production or agricultural loss can adversely affect the development of the nation as a whole, which needed to be effectively covered with rural insurance.