According to a recent report by the Geneva Association, ‘El Insurance as a Core Element of Financial Inclusion in Emerging Economies—to which Mapfre and Mapfre Economics contributed—financial vulnerability is an everyday reality for millions of people, especially in emerging economies, based on data drawn from surveys conducted in seven of these markets: Brazil, China, India, Mexico, Morocco, South Africa, and Turkey.

The study also confirms the contribution of financial inclusion and the insurance sector to development, particularly in contexts where large protection gaps leave people highly exposed to economic crises.

The value of insurance

Unlike savings, which are constrained by liquidity needs, or credit, which can deepen indebtedness, insurance plays a distinct role by transferring risks away from households and strengthening collective capacity for adaptation and resilience.

This is even more evident in emerging markets, where insurance activity “provides essential risk coverage to populations that are often excluded from or underserved by the formal financial system, offering protection that strengthens resilience, supports equity, and fosters social cohesion,” explains Antonio Huertas, Executive Chairman of the Mapfre Group.

He adds that it “enables individuals and families to manage risk more efficiently and affordably. For example, accumulating 1,000 dollars for an emergency may require considerable time and effort, whereas an insurance policy complements savings and investment management strategies at a significantly lower cost.”

Toward a stronger insurance industry

In this context, emerging regions urgently need a stronger insurance sector to support economic and social development. This is the case in Latin America, where insurance premiums account for only 2.8% of the global total, despite the region representing more than 7% of global GDP.

Closing this gap—estimated at more than 300.0 billion dollars—“would increase per capita income, improve savings rates, and benefit low- and middle-income groups,” says Antonio Huertas. In his view, “addressing this shortfall requires coordinated public and private action. Improving insurance and financial education is essential, as is the development of more flexible and personalized products tailored to people’s real economic conditions. Technology offers vital tools to expand coverage, especially through mobile phones, which are more widespread than computers or bank accounts.”

Ultimately, he concludes, “insurance can drive socioeconomic development, reduce vulnerability, and ensure broader, more inclusive prosperity.”

Survey findings

Overall, medical costs are the main concern for households in the markets analyzed, reflecting gaps in public healthcare coverage and a significant financial burden on individuals.

In these countries, at least 70% of respondents consider insurance to be useful, and most value its role in protecting assets and mitigating risk.

Among those who do not have coverage, access to these products—which has improved through new digital ecosystems—does not appear to be the main challenge. Rather, affordability is the key issue, especially for health insurance. At the same time, a lack of sufficient knowledge remains one of the most significant barriers to the development of life savings insurance, among others.

Levers for progress

Insurance is essential for financial inclusion in emerging economies, yet it remains less developed than other financial services. The report identifies three key levers to promote its development and foster cooperation among insurers, policymakers, and regulators.

On the one hand, it calls on insurers to design simpler, more accessible, and more efficient products, while leveraging digital technologies to reduce costs. Sales innovation is accelerating, particularly through parametric solutions, embedded insurance, and mobile-enabled products.

On the other hand, policymakers need to integrate insurance into national financial inclusion strategies. China and India, for example, position insurance as a pillar of public policy, helping to drive its expansion. Finally, inclusive insurance can thrive when regulatory frameworks strike a balance between market growth and consumer protection, while strengthening trust.

New steps in financial inclusion

Within our Group, we are committed to financial inclusion. In its report Trends and Elements for the Development of Insurance Markets, Mapfre Economics had already highlighted this factor as one of the main areas of focus to increase the penetration of insurance, recognizing its ability to raise overall levels of social well-being.

Mapfre also launched a new range of microinsurance products in December to protect small entrepreneurs in Latin America: A tu lado Mapfre, which forms part of our commitment to financial inclusion and insurance awareness. The project, which has been operating for some time in Brazil under the name Mapfre Na Favela, has taken its first steps in Colombia and will be launched in Peru over the course of this year.