Principal Investigators: Shahid Vaziralli, Camille Boudot, Swati Grewal, Vishnu Prasad, Anand Sahasranaman, and Nikhil Tambi
Research Team: Camille Boudot, Swati Grewal, Vishnu Prasad, and Nikhil Tambi
LEAD Centre: Centre for Microfinance (CMF)
Focus Area: Financial Inclusion
Project Geography: PAN INDIA
Partner: Ministry of Finance
Status: Completed


Approximately 85% of India’s labour force works in the ‘unorganized sector’, defined broadly as those who do not have contracted employment with a formal sector employer, and therefore do not enjoy the social welfare benefits usually accorded to formal sector employees. In recognition of this fact, as well as the recognition that long term demographic trends indicate a rapidly ageing population and a non-declining unorganized sector workforce, The Government of India passed the Unorganized Worker’s Social Security Act (UWSSA) in 2008. The purpose was to provide India’s large unorganized sector workforce with a minimum level of social protection that would enable them to endure income and health related shocks, stay out of poverty, and ultimately allow them to lead dignified lives. Over the past decade, there has been a proliferation of publicly provided schemes in the insurance and pension sectors, both at national and state level. While they represent an important step forward in India’s ability to provide adequate, reliable, and affordable social protection options for its vulnerable population (especially in light of decades of failed attempts at direct provision through the public distribution system), there are still considerable weaknesses in the design and delivery models of these schemes. This study therefore has two clear purposes: (i) Providing a detailed account of the currently implemented government sponsored social security schemes for the unorganized sector, including product features such as eligibility criteria, scope of coverage, and pricing, as well as their major implementation and design related strengths and weaknesses, (ii) Providing a clear set of recommendations and guidelines on how to design and implement a comprehensive social security scheme for the unorganized sector, which includes life insurance, health insurance, and pension.

Related Resources:

WORKING PAPER: Comprehensive Social Security for the Indian Unorganised Sector