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Insuring India’s Women WorkersA nongovernment organization proves that insurance programs organized by the poor for themselves can be viable
BackgroundWomen working in the informal sector of India’s economy are susceptible to critical financial risks. Particularly vulnerable are the poorest of the poor. Should they become ill, lose their job, or be unable to continue working, they and their families may fall into debt and find themselves in the depths of poverty. At risk are millions of poor who depend on the income generated by one or more women in their household. These women do not have regular salaried employment with welfare benefits like workers in the organized sector of the labor market. Informal sector workers include those engaged in home-based activities, vendors, manual laborers, and producers of various kinds. Yet the risks endured by these women have been made more manageable by the Self-Employed Women’s Association - SEWA. Protecting MembersEstablished in 1972, SEWA is a labor union with a membership of 420,000 women workers in Bihar, Delhi, Gujarat, Kerala, Madhya Pradesh, and Uttar Pradesh. It acts to defend the interests of poor women working in the informal sector. To protect its membership against risks such as unemployment, poverty, natural disasters, and sickness, SEWA offers its members a variety of insurance packages. Mirai Chatterjee, coordinator of SEWA’s social security initiatives, spoke about the labor union’s insurance schemes at a seminar on “Public-Private Cooperation on Pension Reform” held in Shanghai on 9 May. “Insurance is an essential economic support to women during crises,” she noted. Under a basic scheme, members can secure insurance against hospitalization for up to rupees (Rs) 2,000 ($41), house and asset insurance for up to Rs5,000, and accidental death insurance for Rs40,000. The cost of this package, which also offers benefits against natural death and the accidental death of one’s husband, is a fixed deposit of Rs1,000 and an annual premium of Rs85. More expensive schemes offer more protection against natural death, hospitalization, and loss of house and assets. Over 10 years, 2,000 women have received some Rs15 million in claims. Ms. Chatterjee explained that SEWA’s insurance program functions as a cooperative. Workers manage services and promote coverage. They also decide on claims, disbursement practices, premiums, products, and policies. She said that SEWA has proven that insurance programs organized by the poor for themselves can be viable. At the same time, servicing costs are high and the insurance programs create demand for government health services. Lessons of ExperienceMs. Chatterjee also noted that experience has shown that linking insurance with health programs focused on prevention and promotion enhances viability of health insurance. Further, linking insurance to other financial services - savings and credit - promotes long-term insurance coverage. Among the benefits generated by SEWA’s insurance programs are the employment opportunities created for those who sell the insurance policies. More generally, Chatterjee observed, “insurance by and for poor women encourages their organizing and contributes to their economic empowerment.” Over 90,000 persons are currently insured by the labor union. With SEWA insurance, “headloaders,” blockprinters, vegetable vendors, and other female workers are able to carry out their daily tasks with greater confidence that they and their loved ones have some measure of protection against adversities. ________________________________ Learn more about ADB's activities in India Find out more about ADB's partnership with NGOs Find out how ADB supports various efforts that promote gender and development |
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