Does Lower Income Affect the Development of One's Innovative Ability in the Education Niche

Introduction

Innovative initiatives which are applied in different contexts reap different outcome/results. It is imperative to take into account the setting in which education is undertaken. For instance, it is important to note that some research scholars suggested that low-income people are at greater risk for poor academic skills than their higher-income peers in an inclusive insurance setting(Ripke & Huston, 2006). The development and growth through education of the low-income insurance sector of the financial services industry in emerging countries has proven to have an imperative bearing on a country’s economic welfare and advancement. Innovation could assist to improve the quality of education in the low-income insurance niche market of developing countries. This chapter focuses on the innovation element in education segment of the low-income insurance sector of the financial services sector which is the inclusive cover area both from inside and outside the organization where microinsurance is an important segment. Innovation refers to as the implementation of not new ideas, knowledge and practices only but also of improved ideas, knowledge and practices (Kostoff, 2003; Mitchell, 2003). An important element of innovation known as collective innovation that supports the identification, evaluation, and implementation of new ideas outside the organisation by tapping online resources at each step of the process is known as collective innovation.

Before we identify and apply collective innovation measures in the inclusive insurance market, it is important to understand how the market works in this new midst of the pandemic, hence a snapshot is provided of the low-income market. The low-income niche of the insurance industry, an important segment has been a catalyst as the market has experienced a rapid growth in the developing nations of Asia, Africa and South America over the last ten years insuring lives from 135 million in 2009 to approximately 500 million (Magdas, 2020). The low-income households are more prone to unexpected risks and shocks. Their income is accordingly exposed to a bigger risk of disruption due to a situation that is beyond their control. Due to factors such as financial illiteracy, lack of education among others the low-income consumers cannot properly cope or manage risks that they are often exposed to. Several emerging and developing economies and markets have realized the potential of inclusive cover market in assisting potential consumers people with fluctuating income against death of members, diseases, natural disasters and accidents. Furthermore, the low-income market is recognized as a measure of providing financial means and security to assist low-income consumers to secure healthcare insurance (Qazi, 2021).

In this wake of the 2019-nCoV pandemic, the sector of low-income insurance market has taken its toll (Roy, 2021). Several waves generated by the pandemic has imposed many countries including South Africa to accordingly review their policy objectives in an attempt to emphasise more on the innovative learning and teaching such as the the potential of technology supported learning and digitalisation in consumer education as being one of the essential aspects for a comprehensive solution to consumers protection in the low-income insurance market (National Treasury of South Africa, 2019).

The process of enhancing the understanding of investors the so-called “the consumer” by the providers in becoming aware of the products and services is known as consumer education. This includes giving out information on the attributes including pros and cons, pointing out the element of risks and challenges that can be posed by the products and services and also developing the confidence and skills of the consumers to make calculated choices for their well-being and welfare (The Organisation for Economic Co-operation and Development [OECD], 2019). This definition has also been adopted by the Association of Savings and Investments of South Africa and many other developing countries (Association for Savings and Investment South Africa [ASISA], 2013).