ABSTRACT
Migration allows families to seek higher incomes, diversify their sources of income or escape crisis situations. While migrants offer protection to their families, they are themselves unprotected as they are ineligible to access the health services or social safety net programmes. Migrants face multiple risks, including unsafe working conditions, unstable or under employment, limited access to social, financial and legal services, and smaller social networks. These risks pose an economic burden on migrants and their families and make it difficult for migrants to cope with emergencies, thereby making them and their families more vulnerable. Migration can also lead to increased vulnerability for the migrant’s family because of the absence of one of its members and because families may be less willing to seek alternate sources of income. Market-based insurance solutions that target migrants can offer risk protection to both migrants and families. The unique risks and circumstances facing migrants and their families mean that insurers need to carefully design products and operations. Migration-linked insurance products can cover risks faced by migrants in their host countries (such as accident, death or illness) and risks faced by families in their home countries (such as illness or asset loss). Products may provide benefits for both the migrant and the family, especially in cases where a risk event affects the migrant’s ability to send remittances home and worsens the economic well-being of their families. Providers must decide which model is best suited given the prevailing regulation, the need for marketing and consumer education, and the availability of distribution partners and technology for operations (such as cross-border finance solutions). It is important that the insurance solution is designed to address the priority risks of migrants and their families as it will be challenging to provide a comprehensive solution from the start. Rather, as trust and understanding increases and as experience of providers grows, providers can gradually offer greater protection to a wider number of migrants.
