It's good for you, I promise

Mobile phones are a great development tool, but their meteoric rise in Africa and Asia isn't because of their development portential, but because they are useful and exciting. To most people insurance isn't exciting and isn't even obviously useful. For insurers demand is more difficult.

The usual answer is client education; trying to make people realise insurance is good for them. But we don't usually do stuff because it's good for us. We do something because it's fun or obviously useful or because our parents taught us to, our friends do it or our sister swears by it.

At the moment I'm reading Poor Economics by Abhijit Banerjee and Esther Duflo. If you haven't read it, I recommend it. The book explores many examples in development which show that teaching people something is good for them isn't enough.

Things that are good for us need to become a norm, a habit. And this is where free and compulsory microinsurance schemes come into their own. They don't always offer the best client value, but at their best they provide a reliable and positive experience, make insurance a norm and pave the way for more valuable products.