[Microinsurancefocus] Zurich's Z Zurich Foundation supports the ILO to improve microinsurance's efficiency and scale

[Sarah Bel]

GENEVA(ILO News) - The ILO's Microinsurance Innovation Facilityannounced today
a new partnership with Z Zurich Foundation. The Foundation will support the
Microinsurance Innovation Facility with a contribution of CHF 3 million to
increase access to better insurance coverage to low-income people in a cost
effective way. 
 
Low-income households, often headed by workers in the informal economy, are
particularly vulnerable to the risks, including illness, death, workplace
accidents and natural disasters, like the earthquake in Haiti. Insurance
companies specialize in carrying risk, and with appropriate incentives and
approaches, they could contribute to reducing the vulnerability of the poor.
Many insurers have started to serve the low-income market, but one of the main
challenges they face is reducing administrative costs so as to make risk
protection products affordable for the poor. Therefore, a major focus area for
the development of microinsurance is to improve efficiency in the process of
enrolling often unbanked clients, collecting their premiums in remote areas, and
managing large numbers of small policies. 
 
Funding from the Zurich Foundation will be used by the Facility to organize its
5th round of innovation grants (
http://www.ilo.org/public/english/employment/mifacility/activities/innovation.htm
) that give the opportunity to a wide range of players including national and
multi-national insurance companies, NGOs, community based groups and
cooperativesto test new microinsurance projects in developing countries. The
focus of the round will be on scale and efficiency to encourage providers to use
technology to serve more low-income people and at the same time increase their
economic benefits. Results and learning will be widely disseminated to assure
the broadest possible usage of the gained insights. Application guidelines will
be announced in October 2010.
 
"The sector is working out how to keep costs low. There is the expectation
that, in the next few years, technology will bring costs even lower and enable
access to insurance protection to more individuals in developing countries.
Funding from the Zurich Foundation will help us to support efforts to make this
happen," said Craig Churchill, Team Leader of the Microinsurance Innovation
Facility.
 
 "We believe it's critical to our long-term business success to play our part
in delivering sustainable, long-lasting solutions to important and relevant
economic, social and environmental challenges. In these difficult times of
market recovery, it is important to underpin our commitment to corporate
responsibility and actively support the development of better insurance services
for the less fortunate," said Martin Senn, Zurich's Chief Executive Officer and
Chairman of the Foundation's Board. 
Housed at the International Labour Organization, the Microinsurance Innovation
Facility ( http://www.ilo.org/microinsurance ) was launched in 2008 with the
support of a grant from the Bill & Melinda Gates Foundation (
http://www.gatesfoundation.org/default.htm ). The Facility seeks to increase
the availability of quality insurance for the developing world's low-income
families to help them guard against risk and overcome poverty. To achieve this
goal, the Facility works in close collaboration with the private sector not only
as a funding source, but as implementers. The Facility partners with the many
private sector actors to experiment with approaches to extend insurance to
low-income households, with the objective of reducing their vulnerability and
alleviate poverty. The Facility believes that encouraging the private sector to
consider low-income people as a 'real' market can bring incredible social
benefit.
 
The Z Zurich Foundation'smission is to equip people with the knowledge and
resources to better manage change and risk in their lives and in the world
around them. On a strategic level it develops long-term partnerships with
selected Non-Profit Organizations. The Foundation's focus is on the interlinked
challenges of climate change, water scarcity, food security and economic
development, combining Zurich's global experience and risk management
capabilities with the Non-Profit Organizations' local knowledge and sustainable
development expertise. Current partners are UK-based Practical Action, US-based
Rainforest Alliance, and the Swiss-based International Federation of Red Cross
and Red Crescent Societies (IFRC). 
Zurich Financial Services Group(Zurich) is an insurance-based financial
services provider with a global network of subsidiaries and offices in North
America and Europe as well as in Asia Pacific, Latin America and other markets.
Founded in 1872, the Group is headquartered in Zurich, Switzerland. It employs
approximately 60,000 people serving customers in more than 170 countries.
 
More information at: www.ilo.org/microinsurance
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