In Guinea, CIDR chose to organize the management and governance functions of
microinsurance according to the principles of mutualism because of the local social dynamics, such as cohesive communities with multiple self-help organizations. Additionally, there was an absence of formal social or professional organizations that could have undertaken the tasks of management and product distribution.
The current program was divided into three phases: a pilot phase to test micro-insurance products and the mutual model (1999-2002); a consolidation phase in which a regional network of mutual health organizations was created (2002-2005); and an institutionalization phase that will facilitate the gradual withdrawal of CIDR's support (2005-2006).
Health credit managed by self-help groups and health insurance with cash reimbursements to members were tested during the pilot phase. However, these were quickly replaced with a more attractive insurance arrangement with direct third-party payments to contracted public health facilities.
From its inception, the MHOs’ network has experienced steady internal and external growth. By 2005, the UMSGF has brought together 21 rural and 7 urban MHOs comprising of a total membership of 2,656 families and 14,071 individuals, or roughly 100 families per scheme. This is equivalent to about 10 percent of the target group in those areas.
To meet the needs and financial capabilities of their target populations, the MHOs designed low-cost products (€1.3 premium per person per year in 2005) that offered benefits for hospitalization and surgical procedures at public health facilities. This situation was gradually modified to take into account the diversification of available health care delivery services, as not-for-profit providers increased. The benefits were also modified to meet the demands of the members, such as the addition of outpatient care.
Within 5 years, the adopted insurance management strategy has enabled mutual health organizations to build sufficient equity (€19,500 over 5 years from an annual volume of collected premiums of €12,000 for 2004/05), so they could embark on product diversification. The MHOs benefit from a guarantee system that provides them with access to an intervention fund should their reserves fall below a safety threshold.
In the absence of specific legislation regulating mutual organizations, a not-for-profit organization status was adopted as a temporary measure. The UMSGF is involved in discussions taking place at the national level to draft a bill adapted to its particular status within Guinea.
Program Highlights: UMSGF presents a classic mutual health organization model for the introduction and management of insurance in the developing world.