There are texts that, once read, leave you the impression that each word is placed exactly in its spot, especially created for it. It’s like a literary puzzle. All you need to do is to perceive it with patience. In these situations, the reader often asks himself how has he not imagined this logical array of known words and has not imagined their transformation into such powerful ideas. Each verb, carefully chosen, gives a shade, each phrase is the result of a study and work of many people.

Such a reading is also the most recent report of GENEVA Association (details on them, HERE), suggestively titled “Understanding and Addressing Global Insurance Protection Gaps”. Summarily, the material analyzes and seeks solutions for the so-called insurance protection gap. The phenomenon of under-insurance, on a global scale.

The report’s conclusions, presented in terms of demand – and, therefore, of clients -, show how:

  • affordability remains a relevant obstacle for increased insurance penetration, primarily in developing and emerging insurance markets;
  • this phenomenon overlaps a void of poor financial literacy or general education, even in developed countries, because the lack of product understanding is, following affordability, the second most relevant reason for not purchasing insurance.

At the same time:

  • about half of insurance buyers base their final purchasing decisions on price;
  • insurance demand is higher among households with higher levels of financial literacy;
  • service and experiential factors, including clear communications, are among the most relevant drivers of insurance purchasing decisions and are almost as important as price and scope of coverage.

On the offer side – and, therefore, on industry and distribution side -, GENEVA Association states that:

  • the cost of producing insurance cover is currently one of the most intensely debated industry topics, especially in the light of technological innovation – which can provide significant efficiency;
  • in non-life insurance, for example, about 30 cents of each premium dollar are generally absorbed by distribution and general administrative expenses. This fact dents the “economic appeal of insurance”.


There are also solutions: all of them require a multi-stakeholder effort, including the area of public authorities. Along with this sector, which can do a lot to complement the industry’s efforts on financial education, employers have an important potential role to play in influencing employees’ financial behavior, by providing employees with ongoing financial education and training and by promoting and incentivizing healthy lifestyles. At the same time, social media and mobile tools of communication enable quantum leaps in public awareness of insurance and its main characteristics, even in countries with almost no existing traditional distribution channels. Therefore, hope dies last.

Back to Romania, the middle column of the chart above clearly shows who and what to do. It’s not us saying it, but one of the Planet’s biggest think-tanks. In conclusion, we don’t have to dig too deeply, to set our goals at the industry level. One question still remains: who will take a seemingly simple table – which is based on thousands of research hours, if not more -, and translate it into reality? And when?

P.S. The report, in its original form, can be downloaded from HERE!

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