The Beginning of Microinsurance in Cambodia

Cambodia’s finance sector is maturing, and so is PKMI, the first company to offer micro insurance here. On the eve of PKMI’s fifth anniversary, its CEO Solène Favre sat down with Management Insider to talk rebranding, bottom lines and the beginning of a new era for health insurance in Cambodia.

October was a big month for Prévoir (Kampuchea) Micro Life Insurance, or PKMI. The firm celebrated its fifth anniversary, passed the $1 million mark for premiums and, to come into line with the parent company in Paris and other subsidiaries around the world, underwent a corporate makeover: now the firm will be known simply as Prévoir. “The time was right. The mother company also reorganised its image recently and now, with offices in France, Portugal, Poland and Vietnam, we are all the same name, the same brand,” Ms. Favre says.

While Prévoir Group—founded in 1910 to serve mostly miners working in coal mines in the north of France—has operations in five countries, the Cambodian office is unique: it is the only branch to offer micro insurance, with health insurance being its flagship product here. And while Prévoir Cambodia markets itself as affordable insurance for low and middle-income people, the product may be inexpensive, but it is not cheap. “Microinsurance should not only mean cheap insurance. It should be comprehensive insurance adapted to the needs and understanding of the population we are working for,” says Ms. Favre. “It is about defining all the rules and limitations so people understand what they are paying for and how to make the most of their insurance in the most simple way possible.”

The proof is in the numbers. Four years after beginning operations, Prévoir has more than 300,000 active policies in Cambodia, which cover four different products. They work with large firms to insure workforces (coverage averages about $50 a year) and also with microfinance institutions to insure the clients (packages start at $6 a year).

Prévoir Cambodia “is really an investment from Paris,” says Ms. Favre. Cécile Gérard, Prévoir Group’s CFO and Chairwoman of PKMI, pushed for the creation of a Cambodian office and it remains in business as the team here “looks to win the bet that, yes, we can offer products to the formal and informal sector and become sustainable,” she says.

Changing Medical Standards

Prévoir Cambodia works with 207 hospitals in all provinces across the country. When a client calls upon their insurance policy, they are directed to the nearest hospital and Prévoir staff are sent to the hospital to facilitate access of treatment, payments and to oversee the procedure. All of the 207 hospitals are audited annually by Prévoir’s medical staff: improving the standard of such facilities is both a goal of Prévoir and a byproduct of its attention to detail. “We don’t have the objective to expand to more hospitals, but to improve the quality of service delivered and processes at the hospitals we are partnered with,” says Ms. Favre, adding that eliminating unnecessary treatments is the area that most needed working on, and that Prévoir’s medical team follows standard protocol from the World Health Organisation.

Prévoir’s footprint in Cambodia is growing, and with so many clients coming on board, medical facilities are seeing the benefits of attuning to Prévoir’s minimum standards. “I think we are starting to matter to them,” says Ms. Favre. “They need us and the people we insure, so we have some leverage to discuss things with them and make progress.” Prévoir’s medical team focuses on the facility’s opening hours, the availability of staff and medicine, and the quality of treatment in line with MoH guidelines. “The change can be seen in the awareness of the public. People now understand what to expect and if the hospitals don’t meet those expectations, they report to us.”

A New Horizon

With the advent of the National Social Security Fund (NSSF), the Royal Government of Cambodia has committed to reach universal health coverage by the end of the decade, meaning that all people will have basic coverage. What effect that will have on Prévoir remains to be seen, according to chief commercial officer David Koy.

“The fact is, our corporate clients are waiting to see what products the NSSF will be offering and what hospitals they will be working with,” Mr. Koy says. “Our clients have become accustomed to our products and services. They know how private insurance works, and they know that we have checked all the hospitals to make sure that they offer acceptable services,” he says.

Ms. Favre conceded that the introduction of the NSSF would disrupt the market to some degree, but said that ultimately it was a positive marker for a developing country. “In the corporate health sector, for sure, we will have to work differently. We will need to provide different products to those we offer today. But the main point is that it is a good thing for Cambodia. It is necessary for the population to be covered for basic health coverage. We will just have to adapt to that.”

Illegal Clinics

Despite efforts by the Ministry of Health to put an end to unlicensed clinics operating across the country, illegal operations of that type remain. Ms. Favre explained a case from last year where a patient was told that he needed an operation, but that the operation could not be performed at the public hospital. Instead the patient was taken by the doctor to a “private clinic”, which turned out to be an unlicensed, illegal clinic—which Prévoir and other insurers do not include in their coverage. “He trusted the doctor,” she says. Prévoir eventually agreed to pay a share of the costs, and then used the case to illustrate how illegal clinics operate to all employees at the patient’s firm.


With more than 50 staff across the country, Prévoir is working with eight microfinance institutions to offer bancassurance, where microfinance loans are accompanied by insurance plans from Prévoir. “We don’t do mass media we are in the field with the MFIs staff to sell these products to people who need them most,” Ms. Favre says.

“People in the provinces don’t have access to traditional insurance products, but, thanks to PKMI, they now have access to a comprehensive $6 coverage.” “We are not talking about poor people here, but those who are no longer poor, but we know for them one medical expenditure can send them back below the poverty line. This is who we are working for.”

Words by Vivaddhana Khaou