Microinsurance for social inclusion: MAPFRE na Favela was born

Microinsurance for social inclusion: MAPFRE na Favela was born
Microinsurance for social inclusion: MAPFRE na Favela was born

MAPFRE na Favela is the materialization of a purpose and objective of the MAPFRE Sustainability Plan: promoting access to insurance for segments of the population with lower incomes. It is a business with social impact that offers protection and care to people.

The MAPFRE na Favela project has just been launched, an initiative that, through microinsurance, aims to improve social inclusion. What is microinsurance? How can these microinsurance contribute to sustainable development and improve the economy of vulnerable environments?

Microinsurance is insurance aimed at the low-income population and adapted to their needs, both in the form of distribution and in the coverage and services offered. They are characterized by offering limited but sufficient coverage aimed at protecting life, assets, or family and, in this way, promoting the financial stability and economic inclusion of this segment of the population. The nature of microinsurance is to offer insurance that responds to a social demand or need.

Companies are beginning to care about generating a positive social impact and, in this scenario, microinsurance is the main product with this approach, which reinforces the social function of insurance.

The possibility of accessing insurance products and services can make the difference between individuals or families achieving the goal of social mobility or remaining in conditions of economic vulnerability. Hence the importance of the social aspect in the development of the microinsurance product, which can be in different areas: health, life, harvest, climatic parameters and automobiles.

One of the most important aspects of this project is that there has been prior research work and listening to the demands of the local population. What have been the main needs detected by the work team?

The big difference for MAPFRE na Favela has been to come into contact with the favela ecosystem to understand local needs, and thus learn and integrate these specific demands into its business model. Listening to the customer is one of the main steps in the product development process and that is what we have done.

One of the first steps was to get a closer look at the reality of those who live in the favela to identify their basic needs and then develop insurance products that had a perceived value for this significant part of the population.

In addition to generating a positive social impact, the objective was to promote access to insurance for an excluded population (one of the phrases we heard the most during the project construction process was: “Insurance is not for me”), rescuing the function social insurance (protection and security).

The project focuses on the favela entrepreneur, who generally works informally and must solve very complex problems every day to be able to bring income home, so we decided to accept the Brazilian tax identification number for the registration of the three products .

What impact is this project expected to have on the target population? How can this project help reduce social and gender inequalities?

We hope it will be a project with great social impact. With MAPFRE na Favela we empower people and bring financial and insurance education to an important ecosystem in Brazil.

According to data from the 2022 Demographic Census, released by the IBGE (Brazilian Institute of Geography and Statistics), Brazil has more than 13,000 favelas and urban communities where nearly 16 million people live, which represents 8% of the Brazilian population. . According to Data Favela 2023, Brazilians living in these communities generate around 200 billion reais a year and about 5.2 million entrepreneurs (small business owners) live in the mapped favelas.

Agreements have also been signed with G10 Favelas and Vivenda da Criança, local social organizations. What does this collaboration consist of? What role will they have in the implementation of the project?

G10 Favelas and Vivenda da Criança are NGOs that will act as promoters in the dissemination of insurance products for a self-contracting model within the favelas.

G10 Favelas brings together leaders and entrepreneurs with social impact in the favelas of Brazil, who transform the donations they receive into essential goods and actions to combat poverty, hunger and inequality in the communities of Paraisópolis and Ciudad Ademar. And Vivenda da Criança is a non-profit organization that works with the less privileged population of the Parelheiros region.

The idea is to take advantage of the experience and penetration of these institutions in their respective communities to facilitate access to MAPFRE na Favela among microentrepreneurs, the main clients of these products.

Based on demands from entrepreneurial people in the favelas, three products have been developed to promote accessibility to insurance. How are they different?

The design of the products is the result of in-depth research and aims to help the favela entrepreneur and his business model.

MAPFRE Meu Bem Protected offers protection and assistance for goods and products essential for the operation of the enterprise; MAPFRE Meu Trampowith protection for the workplace and MAPFRE Minha Vida It is a death insurance that has well-being as its objective.

Could this project be applied in other areas? What learnings could be useful in other contexts?

Of course. MAPFRE na Favela products have been designed with the most vulnerable groups in society in mind, who seek protection for their assets, but do not have the support of any insurance company.

This is a project that is constantly evolving, in which we are identifying other groups with the same purpose, including our partners of business, insurance brokers. We have already carried out an evaluation to validate all the hypotheses of the business model in order to define a scale model and, consequently, the expansion of the project.

One of the key aspects when a person contracts insurance is transparency: understanding what the service consists of and what that contract entails. How is MAPFRE working to develop a simpler model that responds to the demands of its clients and takes into account the diversity of profiles (age, disability, training, resources, etc.)?

This was one of the challenges we had to overcome. During the first quarter of 2024, the focus was on developing a simpler and easier contracting and sales model, using user-friendly technology to address the demands identified in the first pilot.

To do this, the teams worked with the objective of enabling the marketing of these products in an agile and digital way. As it is a new way of contracting insurance products, this system had to be created from scratch to respond to the specific demands and characteristics of this audience.

One of the first challenges was that for this population there is no separation between a legal entity and a natural person. So, to help the small entrepreneur, we choose to accept only the Brazilian tax identification document for registration on all products. Here the person is the company itself.

Finally, at a general level, how does MAPFRE integrate sustainability into the company culture and its business strategy?

MAPFRE na Favela is a practical example that shows how sustainability is integrated into our strategy and business model.

Sustainability is one of our four strategic pillars, which define and guide our operations in the market.

We are a company attentive to global challenges, committed to people and the planet, which works to leave a positive mark on society.

With MAPFRE na Favela we have managed to bring together a squad of more than 30 people from different areas, working together to achieve the common goal of delivering something that really made sense. By experiencing in practice the construction of a project of this magnitude, these employees are the true ambassadors of sustainability and what it means to integrate ESG criteria into the business, helping to spread the culture of sustainability in the company.

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