There are of course a variety of conventional transactions, but basically, all are a combination of two factors, risk and return. Islamic finance is expected to offer further possibilities to finance by adding a new dimension to risk and return, which is Islamic values.
Unfortunately, although a range of insurance products is available, very few of them have migrated successfully downmarket to serve the poor, whose need for such protection is arguably more acute. One plausible reason holding back the diffusion of micro-insurance is transaction costs, i.e., the cost of selling and underwriting insurance and evaluation of claims in a timely and efficient manner.