The opening session of the 2020 International Conference on Inclusive Insurance (ICII) - Digital Edition, co-organised by the Luxembourg-based Microinsurance Network, is currently underway in Munich, Germany; the conference is taking place from 2 to 6 November 2020.
The opening session focussed on the need for inclusive insurance in the face of the COVID-19 pandemic. The pandemic has highlighted the crucial role of insurance as a safety net when people lose their jobs or are unable to get to work, when bread-winners get sick or die or when small businesses are forced to shut. Yet the number of customers in emerging markets with insurance cover is still alarmingly low.
To address these concerns, more than 1,400 experts from around the world representing NGOs, development agencies, regulation, supervision and policy experts and the insurance industry are meeting online this week for the ICII 2020 – Digital Edition, hosted by the Munich Re Foundation and the Microinsurance Network.
“The COVID-19 crisis shows how important it is to understand and manage risks,” explained Dirk Reinhard, Vice Chair of the Munich Re Foundation and chair of the ICII 2020 steering committee. Without insurance, low-income families and small businesses will continue to struggle when hit by extreme weather events. The conference aims to encourage governments and insurers to intensify cooperation to develop better risk management solutions.
Katharine Pulvermacher, Executive Director of the Microinsurance Network, added: “Despite some improvement, insurance cover is still alarmingly low in many developing economies. The results of our new Landscape of Microinsurance study indicate that, in the countries covered, more than 90% of emerging consumers still lack insurance protection for any kind of risk. COVID has a disproportionate impact on low-income people, as does climate change. The Microinsurance Network, Insurance Development Forum (IDF) UNDP and InsuResilience Global Partnership are working together to scale up insurance solutions which truly meet the needs of this customer segment”.
Launched today, Monday 2 November 2020, the latest Landscape of Microinsurance revealed that although digitalisation is essential for reaching underserved clients at scale, face-to-face contact through agents, brokers, financial institutions and microfinance institutions (MFIs) remains crucial for microinsurance distribution. The study also highlighted concerns about customer value, finding that low average claim ratios and long claim turnaround times undermine trust and hinder uptake. Insurers and their distribution partners must place greater emphasis on customer-centricity to achieve both value and scale.
Ms Pulvermacher commented: “Low-income people are less likely to have adequate health insurance if they get sick, income protection if they lose their jobs or life cover if they die and small companies are unlikely to have business interruption insurance if they are forced into lockdown. Many people have to choose between risking their health or losing income. They may have to sell assets or go further into debt just to survive. [...] Inclusive insurance for just a few dollars a month could help them avoid the worst consequences”.
The ICII 2020 Digital Edition, which brings together key players such as IDF, the Association of Insurers and Reinsurers in Developing Counties (AIRDC) and UNDP among others, aims to attract even more participants than the usual face-to-face event.
“The conference is a great opportunity for some of the best minds in the business to get together and come up with innovative insurance solutions which will help those hardest hit by global crises such as climate change or pandemics. Collaboration is the key to success and I’m confident that we can harness the collective expertise to help those most in need of affordable insurance", concluded Ms Pulvermacher.