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ILO, Munich RE Foundation Highlight Innovations in Microinsurance

ILO10 April 2012: The International Labour Organization (ILO) and the Munich RE Foundation have released the second volume of "Microinsurance Compendium, Protecting the Poor," which highlights that the number of microinsured people has reached almost 500 million. The report emphasizes the role of microinsurance in poverty alleviation when combined with social protection, risk prevention, mitigation, and vulnerability reduction.

The report features 26 chapters addressing innovations in microinsurance. Part 1 covers emerging issues such as: current trends in microinsurance; the impact of microinsurance; and microinsurance and climate change. Health insurance, life insurance and general insurance are covered in Parts 2-4, while Part 5 examines insurance and low-income market. Other parts examine: insurers and microinsurance; delivery channels and intermediaries; and the infrastructure and environment for microinsurance.

The Compendium underscores increasing climate change risk, stressing its impact on the poor, due in part to weak infrastructure. It provides an overview of emerging climate change risks, the role of microinsurance in addressing weather-related risk and the operational challenges. It describes drought insurance and rain-based index insurance schemes in Mongolia, India, Mexico, Malawi and Ethiopia. The report recommends regularly adjusting product design to meet changing climatic conditions, among other guidance to microinsurers. [Publication: Microinsurance Compendium, Protecting the Poor, Volume 2] [ILO Press Release]