The world's landscape of microinsurance Microinsurance Business Models for Africa Learning Sessions - Zambia 9-12 March 2015 10.3.2015
The Landscape of Microinsurance in... / The World Map of Microinsurance www.worldmapofmicroinsurance.org www.microinsurancelandscape.org
The Landscape of Microinsurance in... / The World Map of Microinsurance Background Six studies since 2005 including The Landscape of Microinsurance in the 100 poorest countries The specific objectives are: Describe the general state of and recent trends in microinsurance; Identify gaps in access to and supply of microinsurance; and Identify key bottlenecks to dramatically expanding a viable and sustainable microinsurance sector Shortcomings Voluntarily reported data Only aggregated data published No governmental schemes included (Africa, LAC) Source: Munich Re Fundation / GIZ: The Landscape of Microinsurance in Africa 2012
The World Map of Microinsurance (WMM)...... will host data and analysis from significant landscape studies, which will be displayed visually on an interactive world map.... will incorporate interactive data tools, such as customizable graphs and tables to compare data.... will contain country and regional profiles www.microinsurancenetwork.org/world-map-microinsurance www.worldmapofmicroinsurance.org i Co-published by MiN and the Munich Re Foundation Regional sponsors Partners of the WMM Contractor of the WMM programme
Overview of the landscape of microinsurance
Definition of microinsurance A product is generally defined as microinsurance if it is modest in premium and coverage and meets the following four criteria: Target population: The product targets the low-income segment of the population, those who have so far been excluded from mainstream insurance offerings. Business line: Microinsurance can be found in all business lines, including life, accident and disability, health, property, p and agriculture (crop and livestock). Sales: Microinsurance may be supplied by various stakeholders and through a variety of channel types. Affordability: The premium amount is commensurate with the income level l of the low-income sector. Source: Munich Re Fundation / GIZ: The Landscape of Microinsurance in Africa 2012
The landscape of Microinsurance in Africa Key numbers (2011) 511 providers 598 total products Number of policies Million Life 33.9 Credit life 8.8 Health* 2.4 Accident 2.0 Property 0.8 Agriculture* 0.2 Total: Approx. 44 million lives or properties are covered with microinsurance *excluding governmental schemes Source: Munich Re Fundation / GIZ: The Landscape of Microinsurance in Africa 2012
Percentage of total population covered by microinsurance in 2011 http://www.mfw4a.org/insurance/microinsurance-landscaping.html Source: Munich Re Fundation / GIZ: The Landscape of Microinsurance in Africa 2012
Coverage http://www.munichrefoundation.org/home/microinsuran ce/microinsurancelandscape/2013 AsiaOceania/InteractiveMap.html Source: Munich Re Fundation / GIZ: The Landscape of Microinsurance in Asia and Oceania 2013 Percentage of total population covered by microinsurance in Asia and Oceania 2012
The landscape of Microinsurance in Asia and Oceania Key numbers (2012) 228 providers 507 total products Number of policies Million Life 83.9 Health* 29.2 Accident 77.8 Property 7.7 Agriculture* 23.8 Total: Approx. 170 million are covered with microinsurance *excluding governmental schemes Source: Munich Re Fundation / GIZ: The Landscape of Microinsurance in Asia and Oceania 2013
Percentage of total population covered by microinsurance in 2013 http://www.microinsurancecentre.org/landscape-studies.html Source: Microinsurance Network / Munich Re Fundation / The Landscape of Microinsurance in LAC 2014
The landscape of Microinsurance in Latin America and the Caribbean Key numbers (2013) 94 providers 200 total products Microinsurance premium >830 million US$ Number of policies Million Life 32.9 Credit life 19.7 Health* 7.6 Accident 20.8 Property 2.7 Agriculture* 2.2 Total: Approx. 49 million lives or properties are covered with microinsurance *excluding governmental schemes Source: Munich Re Fundation / MiN: The Landscape of Microinsurance in Latin Amercia and the Caribbean 2014 Munich Re Foundation 10.3.2015
Do we meet the demand of the market? Source: Protecting ti the poor A mircoinsurance i compendium, edited d by Craig Churchill, hill Munich, Geneva, 2006, page 27
The Landscape of Microinsurance Financial performance
The landscape of Microinsurance in Africa Financial performance (2011) The high loss ratio for health products reflects the reality of community-based schemes, which typically have little to no explicit administrative costs. *For 70% of reported covered lives, survey participants provided premium and claims volumes. Source: Munich Re Fundation / GIZ: The Landscape of Microinsurance in Africa 2012
Growth
Contribution to growth by country Africa Microinsurance grew by 200% in the three years from 2008 to 2011 Source: Munich Re Fundation / GIZ: The Landscape of Microinsurance in Africa 2012
Status of market development Source: Munich Re Fundation / GIZ: The Landscape of Microinsurance in Africa 2012
Social (micro)insurance
Agricultural insurance coverage Exampe Asia Private insurance does not meet the demand. Governmental involvement is necessary!
Health insurance coverage Example Asia
Type of risk covered by social microinsuance
Mobile insurance
Key findings GSMA state of the industry report 2014 Mobile services for the unbanked As of June 2014, 17 million policies had been issued Five services had provided more than one million policies 10 new mobile insurance services were launched in 2014, increasing total availability to 100 live services Life cover is the most common mobile insurance product, accounting for 88.1% of all mobile insurance policies issued to date Source: GSMA - Mobile money for the unbanked. The state of the industry 2014
Mobile microinsurance in Africa Life through loyalty programs: 3.1 million (as of end of 2011*) Average premium/year: 0.7 US$... Also, an increasing number of insurers are linking their products, typically life insurance, to more passive delivery channels. One passive channel that has shown tremendous power is mobile service providers... Source: Munich Re Fundation / GIZ: The Landscape of Microinsurance in Africa 2012
Market opportunity in Africa < 50 million lives or properties covered with microinsurance > 80 million active mobile money accounts > 180 million registered mobile money users > 600 million people use mobile phones > 1100 million total population 0 200 400 600 800 1000 Munich Re Foundation 10.3.2015
Key trends
Market perception Africa Source: Munich Re Fundation / GIZ: The Landscape of Microinsurance in Africa 2012
Key trends Africa Total outreach < 50 million lives and properties South Africa remains the dominant market, accounting for over 60% of all covered lives or properties. The expansion of life microinsurance was the main driver behind the impressive growth of the African microinsurance market. Crop and/or livestock microinsurance is now offered in at least 14 countries but reaches only small number of clients Outreach in health microinsurance has stagnated in general over the last three years Life (excluding credit life) and health products are mainly sold on a voluntary basis. Source: Munich Re Fundation / GIZ: The Landscape of Microinsurance in Africa 2012
Key trends cont. Africa Community-based schemes make up 70% of all microinsurance providers but less than 9% of total lives or properties covered. Only 14% of all microinsurance providers are regulated commercial insurance companies, but they cover 78% of all lives or properties insured. Commercial insurers tend to focus more on financial performance, while other providers focus more on client satisfaction and social performance. Mobile insurance is growing g fast
Summary worldwide Total number of lifes and properties covered Total reported premium (million US$) Africa < 50 million < 550 (2011) LAC < 50 million > 830 (2013) Asia Oceania > 170 million < 990 (2012) Microinsurance market accounts for > 2.3 billion premium worldwide Life insurance is dominating the microinsurance market!
What s next?
The Landscape of Microinsurance in Africa 2015 11th International Microinsurance Conference - Morocco Will be carried over the next month in 2015 by the Microinsurance Centre Preliminary results will be presented at the www.microinsuranceconference.org/2015 Munich Re Foundation 10.3.2015
Thank you Dirk Reinhard Vice Chairman Munich Re Foundation dreinhard@munichre-foundation.org