With its roots in the microfinance movement, MicroEnsure has been a microinsurance pioneer since 2006. Richard Leftley, CEO and Founder, and Kiereini Kirika, Regional Director for East Africa say the recent move to become part of the Micro Insurance Company marks the start of an exciting new chapter.
How has MicroEnsure evolved over the past two decades?
MicroEnsure: We have always been at the forefront of shaping the industry. For example, we were the first to try weather index insurance in 2004, the first to work with mobile networks in 2009, and the first to partner with ride hailing companies in 2018. MicroEnsure has traditionally been involved in creating products, driving sales, collecting premiums, educating consumers, and helping get claims paid quickly.
We have served more than 65m people across Africa and Asia, and we continue to be one of the industry’s most prolific innovators! At our heart is a desire to see people gain access to the safety net that insurance provides. Traditional insurers have been working in emerging markets for decades. Yet, 97% of people still do not have insurance, so something needs to change!
As of July 1st this year, MicroEnsure merged with TonkaBI and the STP Group to launch the Micro Insurance Company. That is an exciting development because it means we will now be able to underwrite our own products and control the insurance value chain from end to end.
What are the main challenges and opportunities in the regions where you operate?
MicroEnsure: Microinsurance has always posed a distribution challenge. You can have the best product in the world, but if you have a cumbersome customer journey, you will fail to gain traction. It has been great to be involved in helping regulators shape the rules over the years to facilitate increasingly frictionless customer journeys. However, more is still needed, especially in relation to collecting premiums.
Insuretechs are about driving mass distribution because insurers do not really get how to do it. We need to be ruthless as an industry in eradicating friction, so that it is easy to sign up for and pay for insurance.
What is the business case for microinsurance?
MicroEnsure: Pretty weak! We suspect that most insurers see what we do as CSR rather than a genuine business opportunity.
Does the ‘micro’ label hinder market development?
MicroEnsure: No, we were MicroEnsure, and now we are the Micro Insurance Company. The other terms are just fads to be replaced in a few years!
Is there still an insurance gender gap?
MicroEnusre: Not that we are aware of. We design products for humans, and most of our clients are women.
Tell us about your involvement with the MiN over the years.
MicroEnsure: We were there from the outset as a member of the CGAP working group, and when that transitioned into the MiN, we joined up. Originally, it was a way to learn from others, help shape the debate about best practice, and secure funding from donors. Over the years, our priorities changed, and now it is a great way to learn from others and share our experiences.
One of our highlights was helping write the book on microinsurance all those years ago. It was great working with a range of people on that project. We have loved being an active participant in the annual International Conference on Inclusive Insurance (ICII) each November, learning from others. We have also participated in the world map of microinsurance and tried to shape how the data was gathered.
Where should the MiN go from here?
MicroEnsure: We have been vocal that the Network must choose to serve a constituency. Trying to be all things to everyone is hard, and we feel the MiN should be more focused on meeting the needs of insurers, researchers, or donors. It is a risk that over time the MiN’s role will become less clear if it remains a generalist, and as a result harder to fund.
We also think that the Network should exert more effort at the regional level, helping create local opportunities to learn and network. The MiN should also partner more closely with the A2ii team to help drive forward the regulatory change that is needed to help the industry grow rapidly.