Life insurance for HIV sufferers

Economist writes

DIAGNOSED with HIV 23 years ago, David Patient thought he would never see the day when he could insure his life. Until the launch late last year of AllLife, an innovative insurance newcomer, the few life insurers taking on clients with HIV offered very limited cover and charged prohibitive premiums. But AllLife is specifically targeting customers carrying the virus, offering them more affordable insurance for up to 3m rand ($410,000). They are now able to protect their loved ones and get mortgages. This is changing perceptions of a disease often considered to be a death sentence.

The average probability of AIDS death in South Africa would appear to make life cover prohibitively costly for people with HIV. But extremes rather than averages apply to HIV/AIDS: people who monitor their health and are treated tend to do well; most of the rest die quickly when AIDS sets in. The first group's risk profile is no worse than diabetics', according to AllLife. To maintain their cover, clients have to go for regular blood tests and take antiretroviral medication when needed. AllLife sends reminders for tests and monitors results. This helps clients to stay alive—and AllLife to keep risks down. Although its cover costs two to five times more than standard life insurance, it is much cheaper than what was available before.
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Life insurance remains beyond the means of millions of South Africans—whether they carry the virus or not—and very few apply for cover. Many of those who discover they are HIV positive withdraw because of confidentiality fears. But according to the Life Offices' Association, an insurance body, some established firms will soon come up with affordable products, too. It took decades before diabetics could insure their lives; let's hope people with HIV do not need to wait much longer.

Reading about AIDS, its public health implications, socio-economic profile of its victims and all the calls for donations to help them, i had always assumed that treating aids is a perfect example for a justifiable government intervention - and that private sector had little role to play, except in terms of charity. Bill Emmott, former editor of the economist once said that a key function of journalism is to challenge assumptions. This piece certainly challenged mine.

Even now, I don't, in any way, think that governments should keep away from dealing with AIDS. But, i look at this as an example of problems that businesses can address - even if they have to work a little harder for it.

And CK Prahlad has more examples in Fortune at the Bottom of the Pyramid.