I am spending this summer in Chicago at a startup called Umby, which is a peer-to-peer microinsurance platform. Microinsurance is just like regular insurance, except that it targets at individuals living in poverty internationally, mostly making less than $4 USD a day. To address their needs, the premiums and coverage for this type of insurance are relatively low, but it provides an important safety net for families trying to escape the poverty cycle. Umby works by selling umbrellas to consumers, with the money then going to insure one family (of the consumer’s choice) for a full year.
The main social injustice that Umby is redressing is global poverty. In developing countries around the world, individuals are especially vulnerable to the financial hardships which affect all of us at one point or another: health problems, property damage, and the like. However, for someone who is making barely enough money to get by, these hardships can be absolutely devastating. Studies have shown that individuals facing these hardships will do things like selling off their assets, dipping into (quite small) savings accounts, and reducing their food consumption. The problem is that these short-term solutions actually reinforce poverty in the long run: without money-making assets like livestock, it can be difficult to pay for the next hardship; without building up savings, it can be impossible to do economically advantageous but expensive activities such as sending children to school; reducing food consumption to the point of malnourishment or undernourishment can result in long-term health problems that will cost more money later. This is where insurance comes in. If a family has the ability to use insurance to pay for these hardships, they no longer have to deplete their assets or savings, ultimately helping to break the poverty cycle in the best cases.
Further, according to the 2013 Intergovernmental Panel on Climate Change, climate change is affecting the poorest countries in the world the most. Many forms of microinsurance help protect against the power of global climate change, including catastrophe insurance and many forms of livestock or crop insurance. This is another social justice issue: the wealthiest people in the wealthiest countries have the ability to ignore the effects of climate change, but those living in poor regions around the world do not have the infrastructure or the funds to recover from natural disasters.
I am specifically in charge of marketing for Umby. Umby will be officially launching at the end of the summer, so I am developing blog posts and social media strategies to ensure that people will hear of it and will be interested in donating or buying an umbrella themselves. Without the effective marketing efforts, we may not be able to provide microinsurance at all.
We are working inside of 1871, which is an incubator in downtown Chicago for startups, most of which are related to tech. This is a really cool environment to work in, as there are a ton of other young people working on a variety of new ideas, many of which are related to social justice. Most of 1871 is taken up by a huge, open workspace, where dozens of people sit on their laptops or talking to one another. It is a very artistic environment, with one side of the room taken up by this huge sculpture of downtown Chicago. There are also murals on the walls of the building done by local artists. It is definitely way cooler than your average office.
By the end of the summer, the major event that will be happening is the official launching of the company. I hope by then I will have raised awareness on social media and provided some helpful blog posts that spark interest in the mission and work of Umby, and are entertaining and fun to read.
Lily Elderkin