MICROCAPITAL.ORG STORY: International Association of Insurance Supervisors (IAIS), Consultative Group to Assist the Poor (CGAP), World Bank, International Labour Organization (ILO), FinMark Trust, and German Federal Ministry of Economic Cooperation and Development Launch Access to Insurance Initiative

A recent statement released by the International Association of Insurance Supervisors (IAIS) announced the launch of the Access to Insurance Initiative (A2II). The initiative will be launched by IAIS, in association with the Consultative Group to Assist the Poor (CGAP), World Bank, the International Labour Organization (ILO), FinMark Trust, and the German Federal Ministry of Economic Cooperation and Development (BMZ) [1].

The initiative is designed to improve the poor’s access to insurance markets by assisting insurance supervisors and strengthening their expertise in the area of emerging and underserved markets. The release said that IAIS and those involved in the project plan to “contribute towards an improved policy, regulatory and supervisory environment consistent with international insurance standards, encourage investment in the insurance sector, and develop sustainable microinsurance operations in emerging markets” [1].

Further details regarding the initiative have not been released. According the ILO website, a document on regulation and supervision of microinsurance in emerging countries is currently being drafted [2].

Armando Vergilio dos Santos Junior, chair of the IAIS Subgroup on Microinsurance said “The challenge before us today is to elaborate standards that allow low-cost delivery of insurance services without exposing customers to unnecessary risks and costs” [1]. For MicroCapital coverage on some of the challenges facing the microisurance industry, please visit https://www.microcapital.org/microcapitalorg-story-wharton-business-school-online-portal-acknowledges-the-need-for-innovation-in-the-microinsurance-sector-and-highlights-the-existing-barriers-to-a-wider-acceptance-of-microinsur/. For discussion of the potential for microinsurance in emerging markets, please see https://www.microcapital.org/microcapitalorg-story-the-scope-for-microinsurance-and-the-importance-of-best-practices-observations-by-accion-international-zurich-financial-services-and-risk-management-solutions-inc/.

The International Association of Insurance Supervisors (IAIS) was established in 1994. Based in Switzerland, IAIS represents insurance regulators and supervisors in nearly 140 countries [3]. For a comprehensive list of IAIS members, please visit: http://www.iaisweb.org/index.cfm?pageID=31. IAIS issues global insurance principles and standards, provides training and support on issues related to insurance supervision, and organizes meetings and seminars for insurance supervisors [3]. In January 2008 it launched the IAIS DISCOVER Project which was created to deliver online tutorials to insurance supervisors around the world. As of December 31, 2007, total assets for IAIS were USD 5, 901, 294, according the company’s annual report available on its website [4]. IAIS’ funding comes from investments in a Swiss Government bond, as well as certain members and third parties, such as the Bank for International Settlements, the Financial Services Agency (Japan), and others in the form of grants [4].

The Consultative Group to Assist the Poor (CGAP) is an independent policy and research center dedicated to advancing financial access for the world’s poor. It is supported by over 30 development agencies and private foundations who share a common mission to alleviate poverty. At the end of 2008, CGAP’s total assets exceeded USD 40 million [5].

The World Bank is a source of financial and technical assistance to developing countries around the world for purposes including education, health, public administration, infrastructure, and more [6]. For more information, please visit http://web.worldbank.org/

The International Labour Organization (ILO) was founded in 1919. ILO is the global body responsible for drawing up and overseeing international labour standards. Working with its member states, ILO seeks to ensure that labour standards are respected in practice as well as principle. An annual report for the organization is not available on its website [7].

FinMark Trust is the founding sponsor of the Access to Insurance Initiative. FinMark was established in March 2002 with funding from the UK’s Department for International Development (DFID). FinMark is an independent trust whose mission is to “make financial markets work for the poor.” FinMark attempts to do this by promoting and supporting policy and institutional development in un- and under-banked parts of Africa. Financial information is not available in the company’s annual report [8].

The German Federal Ministry of Economic Cooperation and Development (BMZ) is a ministry of the Federal Republic of Germany. The BMZ was founded in 1961 for the purpose of providing financial aid and help to developing countries. The BMZ’s budget for 2009 is USD 8.6 billion [9].

Related stories and paper wrap-ups on the Microcapital.Org portal on the advantages and disadvantages of microinsurance have been referenced in the Bibliography section below [10] – [18].

By: Diya Chopra, Research Associate

Bibliography:

[1] IAIS http://www.iaisweb.org/__temp/22_October_2009__Launch_of_new_global_programme_to_improve_access_to_insurance.pdf

[2] ILO

http://www.ilo.org/gimi/concertation/ShowNews.do?nid=4415

[3] IAIS

http://www.iaisweb.org

[4] IAIS

http://www.iaisweb.org/__temp/2007-2008_Annual_report.pdf

[5] CGAP

http://www.cgap.org/p/site/c/aboutus/

[6] World Bank