As well as being the Chief of the International Labour Organization’s (ILO) Social Finance Programme and the Team Leader of the ILO’s Impact Insurance Facility, Craig Churchill was a founding member of the Network and its first Chair. The MiN talked to him about how it feels to be both a pioneer and veteran in the inclusive insurance sector.
MiN: How did the ILO Impact Insurance Facility evolve from the Microinsurance Innovation Facility to where it is today?
Craig: It started as a sub-group of the CGAP Working Group on Microinsurance (now the MiN). We studied good and bad practices from over 20 organisations and compiled the first Compendium based on our analysis. We went to the Gates Foundation and said “There’s a lot of potential for insurance in the low-income market, but most products are not providing good value.” The Microinsurance Innovation Facility encouraged insurers to experiment with new products and processes. Around the transition from MDGs to SDGs we realised insurance could make a significant contribution to the broader development agenda, but was largely missing from the conversation. That’s when we shifted gears from ‘micro’ to ‘impact’.
We are a knowledge hub - we extract and hoover up insights from innovators, insurers and distribution channels that are testing new products and processes. We gather their insights into what does and doesn’t work, and repackage them into different communications outputs, publications and training materials. We want to learn from insurers’ experiences – as they try new approaches, we learn alongside them and then share their lessons and experiences with the rest of the world.
MiN: How has the MiN helped develop the inclusive insurance market over the years?
Craig: For inclusive insurance to work, insurers can’t go it alone. Typically, distribution channels, tech partners, regulators and policymakers need to be involved as well. The Network mirrors that model at the global level by providing a space where people who wouldn’t necessarily talk to each other can better understand each other’s perspectives and maybe even create partnerships. It’s super helpful to hear what’s on the minds of these different stakeholders, what their concerns are and what they’re excited about. People feel that they’re not working alone - the Network provides a learning and sharing peer group they may not have in their own companies.
Initially, the MiN was a small group of committed people, mostly from developed countries. The first phase of activities were all about learning - what do we know about regulations, operations and consumer insights? Then came growth, with many more companies getting involved. The next phase, which I think we are currently in, is around technologies - what is the role of InsurTech to advance the cause? It’s an important agenda for the Network - how to take advantage of technology while understanding the consumer protection and client value risks or client value risks.
MiN: How did you get involved in inclusive insurance?
Craig: I’ve been in microfinance for more years than I’d care to admit! I was working for an NGO when separately, USAID and the Ford Foundation both asked if I knew much about insurance. I didn’t know much, but I told them that I would look into it for them, and now 20 years later I am still looking into it. When I joined the ILO, they were already discussing the topic and they asked me to run with it. That led to the founding of the CGAP Working Group on Microinsurance in 2002.
One of the keys to the Network’s early success was that there were a few insurers at the table from the very beginning, so it wasn’t just a development exercise, but was very practical. That’s important because from the beginning, the Network had multiple stakeholders - the development community and the insurance industry were at the initial table and that really helped to shape the chemistry and the approach.
MiN: How does the Facility operate?
Craig: We have a team of seven people in the insurance team, housed in the Social Finance Programme at the ILO, mostly in Geneva. They work on three sets of activities: - learning, synthesising, and promoting and disseminating. All of this is funded by donors. The Gates Foundation was the sole sponsor at the beginning, and although they are no longer directly involved, we have a dozen other funders supporting our work.
We begin by learning from innovation. We work with a range of different insurers and distribution channels to test new products and processes. When a company wants to test something new and exciting, we put an ILO Fellow into their business to help them. The Fellow helps with project management, getting started and moving it along. Having an extra pair of hands to project manage really helps, and the Fellow is well-positioned to extract some of the key lessons. That’s important because we are not just there to help individual companies, but to learn and share the lessons more broadly.
Then there is the extraction, documentation and knowledge synthesis. We’ve have a big body of evidence dating back more than 10 years which we can draw on, so when we see a particular topic that needs researching, we can dive back into our database of partners and see who else has worked on it and what they learned. We can go back to them to see how things have changed over the years.
Finally, we promote these lessons and emerging insights through working papers, webinars, conferences and training. The collaboration with Munich Re Foundation and their conferences has been a critical megaphone for us to promote insights and experiences over nearly 15 years. We also do a lot of training - we are currently supporting six insurance institutes in various developing countries where we certify their trainers to offer our content. We also run the Impact Insurance Academy, where we deliver many of the modules that we’ve developed over the years.
MiN: Tell us about the recent Impact Insurance Academy at the ILO International Training Centre in Turin.
Craig: I was really fired up! We had nearly 70 professionals – half from industry, a quarter from distribution channels and the rest were consultants, policymakers and development practitioners. The energy reminded me that even after 15 years, the message that insurance is an important tool for social and economic development is new to a lot of people. That has potential to create excitement in the insurance industry beyond just shareholder value – it creates new bottom lines!
Insurers need tools to combat distrust or lack of knowledge among their customers. They are starting to understand they need to change public opinion about insurance and insurers. It’s early days, but that’s an exciting direction that we’re heading in.
MiN: What is the Facility working on right now?
Craig: We’re thinking more broadly about the different tools that people can use to manage risks, such as savings, emergency loans and insurance. How do they work together, and complement and reinforce each other? It’s about helping people to manage risk, not just selling them insurance.
Technology is an important way to unlock access, unlock business models, improve efficiencies and creating win-win-win scenarios to benefit insurers, distribution channels and clients. At the Facility we focus on client value. Insurers must create long-term demand by proving their products are valuable and work well for poor people.
MiN: You are one of the few people to have attended every IMC! What does it mean to you?
Craig: It’s an absolutely fantastic partnership. The MiN helps shape the content and Munich Re Foundation adds weight and credibility. It gets bigger every year, attracting not only the ‘old guard’ Network members but people who are either just starting out or who want international exposure. Regional rotation is a brilliant idea - each year roughly a third of participants are from the host country, which is fantastic. They get great exposure to trends and new developments. However, we need to make sure the content speaks to both groups.
Looking back, the 3rd IMC in Mumbai in 2007 was an exciting one for me because we got the green light from the Gates Foundation to start the Microinsurance Innovation Facility. Cartagena (4th IMC, 2008) stands out just because it was such a beautiful location. We also had very long kick-off meetings for the Facility, and Barack Obama was elected while we were there, so that is probably the most memorable for all sorts of reasons.
I look forward to the IMC every year. It’s very exciting to learn about new opportunities, develop new projects and promote what we are doing. From a networking perspective, it’s a super valuable event for me and my team.
MiN: What are some of the key lessons you have learned over the years?
Craig: We stopped thinking about microinsurance as just another financial service for microfinance institutions (MFIs) to offer, and started seeing MFIs as one of many distribution channels. That changed the dynamics and the conversation quite significantly.
Developing a tool to analyse client value is another one. The PACE (Product, Access, Cost, Experience) tool helps insurers think about taking a clean sheet of paper and building a product from scratch. Anybody who’s gone through the analysis using this tool comes away with lots of great insights into why their approach hasn’t worked as well as they hoped.
MiN: You were recently part of the panel on strategic partnerships at the JMM. How can the MiN and the Impact Insurance Facility best collaborate?
Craig: The MiN is moving away from a primarily European membership to a more diverse Network. A lot more needs to be done there, but it’s moving in the right direction. There’s certainly scope to work together to help promote the internationalisation of the Network in terms of recruiting new members. The challenge is finding a value proposition for insurers in developing countries.
MiN: Which highlights of your time with the Network are you most proud of?
Craig: Firstly, this idea that we had 17 years ago with a handful of people in the room together has grown and blossomed over the years. It’s fantastic to see it’s still there and benefitting people. I don’t know if I’d call it a legacy, but it’s something that I’ve helped to create, so it’s certainly rewarding.
Secondly, the Network has had a number of valuable spin-offs - for example A2ii and the Impact Insurance Facility had their roots in the Network and continue to have strong ties to it. It’s not just about “What is the Network today?” but “What has it helped to create?”. I think that those are two really important drivers in this space that are generally well-respected, and it was the Network which helped for them to come into existence. That’s certainly an important achievement.
Finally, the Network works at so many layers beyond the microinsurance space - members working within companies, with other companies, with low-income households. Sometimes it seems a bit distant from the actual impact on the ground, but I do think that there are ways to demonstrate that the MiN is absolutely critical to the development of the industry, getting more players involved and familiar with what works and doesn’t work. The Network has been great for me in terms of networking and dissemination, and I’m thrilled to continue and promote what we’re up to and see how we can even work on some things together.
MiN: Finally, which direction should the MiN go in the next five years and beyond?
Craig: We need to focus on getting more members from developing countries, and diversifying the membership to bring in other stakeholders. The whole public policy and PPP agenda is important, but the Network isn’t yet really in a position to address it yet.
We should also look to bring in more FinTech players - they are an important set of stakeholders. Are there others out there that we should be talking to and engaging with? The Network is only as strong as its membership base, and whilst maintaining key members and adding more is helpful, it’s not just about numbers. It’s critical to make sure we have the right quality players at the table.
I’m very happy that we are having conversations with the Insurance Development Forum (IDF) - there is definitely some overlap and duplication with the MiN, so we need to find ways of overcoming that redundancy. I know the IDF were at the recent JMM, so hopefully some of those conversations will bear fruit.