Microinsurance in the Maghreb

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Microinsurancein the Maghreb
Mutuality, Cultural Diversity and
Development Tunis, 21 May 2004
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Summary

• From microcredit to microinsurance
• Microinsurance system promoted by BEST Re and
  ICMIF
• Implementation the case of the Maghreb

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Summary

• From microcredit to microinsurance
• Microinsurance system promoted by BEST Re and
  ICMIF
• Implementation the case of the Maghreb

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Insertion par le micro-crédit Cas idéal
INSERTION
MICRO-CREDIT
EXCLUSION
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Plus dexclusion Situation plus fréquente quon
ne le pense
Décès, perte outil du travail
INSERTION
MICRO-CREDIT
EXCLUSION
DEXCLUSION
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From microcredit to microinsurance
The microcredit system does present some
deficiencies (lacks) but these can be made up for
by the microinsurance system
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Avec la micro-assurance, le chemin de linsertion
retrouvé
MICRO-ASSURANCE
INSERTION
MICRO-CREDIT
EXCLUSION
More EXCLUSION
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Summary

• From microcrédit to microinsurance
• Microinsurance system promoted by BEST Re and
  ICMIF
• Implementation the case of the Maghreb

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Microinsurance by BEST RE and ICMIF A whole
system
It is not low price insurance
An insurance and reinsurance system made to
provide the poor with insurance products suiting
their needs
The actors of this system must be driven by a
participative and innovative spirit
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Microinsurance A partnership between 5 types of
actors

• Microinsured persons
• Microfinance Institutions (MFIs)
• Non Governmental Organisations (NGOs)
• Mutual Insurers
• Regional Reinsurers (emerging countries)

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Advantages of microinsurance for the partners

• NGO
• Safety for their clients
• Source of financing
• Better usage of its resources
• Asset plus for refinancing
• MFI
• Better securization of the granted credit lines
• Raised level of State intervention

• Microinsured persons
• Financial support to families in the event of
  loss
• Gradual(progressive) integration into the formal
  sector
• Covers and prices adapted to needs..
• Microinsurer/reinsurer
• Access to new markets
• Broadening the base of insurance education

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Micro-assurance Une mutualisation des risques à
plusieurs niveaux
International
Mutualisation
Pays
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Microinsurance dedicated distribution and
management

• Respect of insurance regulations
• Maximum management and acquisition cost saving

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Microinsurance A specific price

• Any service has its price, same thing in
  microinsurance
• This price is set using the same techniques as
  for insurance
• The price takes into account the specificities of
  the microinsured persons among which
• - Their payment capacity
• - The type of fractioning suiting them

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Microinsurance Dedicated guarantees

• Types (life, health, property damage)
• Limits
• Duration

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Microinsurance A dedicated reinsurance

• Mutualization of reinsured risks
• Total loss experience goodwills

Compensation des soldes négatifs
Réserve de stabilité alimenté par des dons
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Une approche dynamique Système initial
Dons
Micro-réassureur
Réserve de stabilité
Markeing et education
Pas de réserve de stabilité
Micro-assureur
Micro-assurés À travers ONG 100 risques
Pas Dépargne
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Une approche dynamique Système cible
Micro-réassureur
Réserve de stabilité
Réserve de stabilité
Micro-assureur
Micro-assurés À travers ONG lt100 risques
Epargne prévoyance
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Une réassurance non proportionnelle (Stop loss)
révisable
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Microinsurance Target countries

• Maghreb
• Sub-Saharan Africa
• Middle-East
• South East and Central Asia

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Sommaire

• From microcrédit to microinsurance
• Microinsurance system promoted by BEST Re and
  ICMIF
• Implementation the case of the Maghreb

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1st contact with NGOs

• Presentation form sent to NGOs granting
  microcredits in the 4 Maghreb countries
• Microcredit portfolio,
• Main causes of non refunding of microcredits,
• Needs in microinsurance

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Taux de réponse
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Micro-crédits octroyés en 2002
1USD1,322TND
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Micro-crédit en 2002
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Illustration with figures 3 microinsurance
contracts

• Microinsurance contracts in the event of death
• Balance due of the microcredit
• Balance due of the microcredit death capital
• Duration 6 months / Capital 1000 1000 TND
• Contracts including savings and provident fund
• Balance due of the microcredit
• Constitution of savings and provident fund
• Duration 5 years / Capital 1000 TND
• Property microinsurance products
• Tool loss compensation
• Duration 1 year / Capital 1000 TND

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Primes mensuelles (TND/mois)
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Conclusions from the answers to questionnaires
for Tunisia

• Two types of NGOs
• International NGOs representations (ex. ENDA IA,
  member of the Enda Tiers Monde family).
• National NGOs (ex. ASAD, AID, FTSS)
• Two regulatory frameworks
• Organic Law N 93-80, July 26, 1993.
• Organic Law N 59-154, November 7, 1959..

• Two types of financing
• International financing for international NGOs
• BTS financing for national NGOs

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Proposals for an economical distribution system

• International NGOs Group Contracts
• National NGOs BTS-Microinsurers bancassurance
  agreement
• Partner-Agent model
• Partner Insurer-Reinsurer working out
  microinsurance contracts
• Agent NGO-MFI Distribution to their
  microcredit clients

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Proposals for an economical management

• Develop a microinsurance procedure manuel
  (enrolment card, premium and loss bordereau) from
  the microcredit procedure model.
• Develop a microinsurance application software
  from the microcredit one.
• Deposit of premiums in bank branch offices in the
  vicinity of institutions granting microcredit.
• Informatisation of NGO-Insurer-Reinsurer
  exchanges.
• Training

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Current needs

• NGOs a larger support is necessary to make a
  database allowing to write up a representative
  feasability study.
• Reinsurers Best Re is ready to coinsure this
  system.
• Donators Best Re will make a donation to the
  stability fund.
• Mutual Insurers inviting all mutual insurers to
  coinsure this system.
• Other partners for the training of adult
  educators, for example.

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Microinsurancein the Maghreb
Mutuality, Cultural Diversity and
Development Tunis, 21 May 2004