DAY 9, NOVEMBER 5, 2007

We began the day with a presentation by the Fund for Communal Development (FONDECO), on its products and services, especially the micro warrant, a seasonal credit designed to provide liquidity to small producers.   The micro warrant permits farmers to increase their income by storing their crops in an ‘Ingenio’ or authorized storage plant, until periods of greater demand when prices rise.

Following the institutional presentation, we traveled by bus to the municipality of Yapacani, accompanied by Milton Lopez, credit Manager for FONDECO.

We escaped from the intense heat to have lunch in a river-side restaurant that included tapir, fresh water fish, and armadillo.

In FONDECO’s Yapacani-Buena Vista agency we met and talked to the manager, Moises Pimentel, who accompanied us to Faja Central where we visited an ‘Ingenio’ or storage plant. We talked to Juan Siguaira Colí, a rice producer and client of FONDECO for six years, who recounted his positive experience with micro warrant.

On our return to Santa Cruz, we stopped in Yapacani to eat an ice cream and carry out the synthesis workshop. Subrat Kumar (India) and Hector Madariaga (Perú) analyzed the Case of Zurich Boliviano, providers of Micro Insurance, whose presentation we saw on Sunday, in the Bolivia Panel, in La Paz.

Volvimos  a Santa Cruz y luego de un breve descanso salimos a cenar. Disfrutamos de la exquisita comida boliviana, conversamos, y algunos representaron el grupo en la pista de baile

We returned to Santa Cruz and following a brief rest went out for dinner.  We talked, enjoyed the exquisite Bolivian cuisine, and in spite of accumulated fatigue, the group was well represented on the dance floor.

Lessons Learned

Subrat Kumar (India)

“Zurich Boliviana, with 60 years of experience in insurance, ventured into micro insurance in 1999 by introducing Mortgage Debtors’ Life Insurance, in collaboration with Bancosol, and, in 2003, launched micro life insurance policy. They forged an alliance with COSUDE, SDC and ILO and, within a short span of time, the coverage has been impressive.  Apart from life insurance, they are offering health insurance for the low income sectors.

Annual premiums range between $12 to $18 USD are affordable and Zurich Boliviana has an record of 100%   claim settlement which is very positive.

We did observe, however, that Zurich has very little coverage in rural areas where the majority of low income clients live. Nor does Zurich have any asset insurance (for cattle, pigs, sheep etc.) which is badly required by the rural clients.

We recommend that Zurich mobilize funding from Governments and international donors so as to promote micro insurance.  We also recommend that they design some innovative crop insurance, fire and allied insurance so that real safety nets could be created for the low income rural households. Zurich could also explore the possibility of designing a single micro insurance policy to cover the life as well as non-life risks. Renewal of insurance is a typical problem in the micro insurance sector.  So educating the potential clients about the need of insurance is a high challenge which needs to be addressed.”

Hector Madariaga (Peru)

 
“The insurance company which provides the micro insurance service is a specialized institution, with experience and international backing.  It is supported by Swiss co-operation and by the international ITO organization for the development of micro insurance for the world’s poor populations. The way the insurance policies are distributed, through alliances with micro financial institutions means that the product is personalized, The premium is very accessible for the sector it is directed to.”