The 11th International Microinsurance Conference closed November 5, in Casablanca, Morocco, a location purposely chosen for its strategic position within the MENA region and its connection to both the Arabic and Francophone speaking world.
Morocco has been experiencing a tremendous socio-economic growth and development over the last 10 years. Whilst the overall insurance penetration at 1.3% remains relatively low in Morocco, the microinsurance market has witnessed a staggering 1700% growth in coverage ratio since 2011, with 4 microinsurance institutions established and a much more diversity offer of products. The main microinsurance products today are health products, with hospital cash as the most popular one.
According to Michael J. McCord, Chairman of the Microinsurance Network, the conference in Casablanca was characterised by constructive and forward-looking debates. To the regulators, representing 27 countries at the conference, the message which was brought forward is that regulators have an important role to support product development and distribution, but need to make sure they are not slowing down the process. In the field of agriculture index insurance, the risk of price volatility was brought up as one of the main issues to consider, in addition to the importance of providing socio-economic data and not only satellite data for farmers. The lack of yield data illustrated one of the constraints of using yield based insurance and governments were requested to play a role in data collection and management of yield measurements. For index insurance to scale up, reaching out to community leaders and village chiefs is one way to counteract the problem of confidence and product complexity. In heath microinsurance, hospital cash is considered as a strong simplified product. Client education was highlighted especially in client servicing by digital means, and through direct agent interaction. Further, there was a focus on data management and the capacity of using big data to make meaningful products and pricing.
In the African Region, 62 million people are insured, covering 5.4% of the total population, mostly in Central and South Africa. While the regional premiums reach USD 647 million, only 1% are dedicated to microinsurance, showing the huge opportunity that remains in the region. The CIMA region possesses 200 insurance companies, but only 10 of these are working in microinsurance. According to Jean-Claude Ngbwa, Secretary General of CIMA, there exists a favourable regulatory environment within the CIMA region for investors to work in microinsurance. However, a consolidation of the insurance market will have to be implemented to lower the relatively high administrative costs. The African stakeholders at the conference expanded on strategies for the development of social businesses and social responsibility programmes as a key driver to promote microinsurance in the region, providing simple and effective microinsurance products to low income people.
The 12th International Microinsurance Conference will take place in Colombo, Sri Lanka from 15 to 17 November 2016.