What is Micro Insurance? – As per IRDA guideline micro insurance is where the amount insured is less than rupees 50000. Now micro insurance caters to the socially excluded groups or workers in unorganized sector who have little savings and extends life and general insurance products to them.
The scheme may be extended on the basis of pooling of community resources or on an individual basis. The premium amount is very less and at times returned under term insurance also.Thy are usually extended by a partner agent model where an agent which is an insurance company which designs the product while a MFI(usually an NBFC) who markets it.
The success of micro insurance depends on the no. of people paying the premium. A healthcare agent is also roped in as the health service provider.