ICMIF International Cooperative

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ICMIFInternational Cooperative Mutual
Insurance Federationwww.icmif.org
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Key points

• About ICMIF
• Linkage with Takaful concept
• Avenues for collaboration
• The development function of ICMIF
• Importance of insurance to poverty alleviation
• Providing microinsurance products
• The need and possibilities in Muslim countries

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About ICMIF

• Established in 1922
• Not-for-profit voluntary trade association
• Represents 127 members from 67 countries
• Member driven
• Strengthen and promote the cooperative and
  mutual insurance sector

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Linkage with Takaful concept

• Policyholders co-operate among themselves for
  their common good
• Every policyholder pays his subscription to help
  those that need assistance
• Losses are divided and liabilities spread
  according to the community pooling system
• It does not derive advantage at the cost of
  others

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Avenues for collaboration

• Reinsurance
• Information
• Training
• Establishing Takaful windows with members
• Development

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ICMIF development function

• Objectives
• Provide support to small members
• Assist cooperative bodies to establish
• insurance operations
• Increase access to insurance to excluded
• sectors of society

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ICMIF development function

• Methodology
• ICMIF Fees
• Technical expertise provided by members
• Development projects led by members
• Partnerships with national and international
• donor agencies

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ICMIF development function

• Progress
• Established 25 people-orientated insurance
• organisations
• Unique Insurance Company Ghana
• Financial support received for Latin America
• Contract to write guidelines on microinsurance
• Turkmenistan State Insurance Organisation
• Health Mutual scheme Mali
• Currently involved in 22 countries

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Insurance is being recognized as an important
tool for poverty alleviation
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Insurance and Poverty Alleviation

• The poor are the most vulnerable
• The impact of losses are more severe
• They have minimum means of recovery
• Success of microfinance schemes show the poor can
  and want to save
• Savings and credit are used unproductively
• The poor need a safety net to escape poverty

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Providing microinsuranceThe challenges

• Coverage
• Regulation
• Moral hazard and Fraud
• Adverse selection
• Education and trust
• Technical expertise
• Affordability
• Retention
• Sustainability

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Providing microinsuranceThe possibilities

• The cooperative microinsurance model
• History of organising the poor
• Operate for the interest of members by
• members
• Trust
• Ownership and loyalty
• Peer pressure
• Surplus reinvested or redistributed

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Providing microinsurance

• The partner agent model
• No-risk fee for microinsurance provider
• Better coverage for policyholder
• Access to new market
• Pooling of risks between informal and formal
• sector

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Providing microinsurance

• The donor agent model
• Access to expertise
• Financial sustainability
• Guiding hand

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The need in Muslim countries

• Social services inadequate or unavailable
• Large sectors of poverty in many Muslim countries
  
• Over half of worlds lowest developed countries
  have a majority Muslim population
• Increasing inequality in Middle East and Gulf
  countries

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Takaful is the second most important social
institution to counter poverty and
deprivation Omar Fisher,1999
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How can we provide microtakaful products?

• Establish informal microtakaful schemes
• Encouragement of pro-poor organisations
• Education of government and donor agencies
• Involvement of Takaful sector
• Technical expertise
• Financial assistance
• Partner-agent model
• Bear ye one anothers burden

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A Global reach for local strength

• Thank you for your attention