international wing of cera

MFIs and microinsurance: does it work?

European Microfinance Week 2010Bert Opdebeeck , bert.opdebeeck@brs-vzw.be

International wing ofsolidarity-based banking and insurance in the developing world

1970s: SACCOs building up a ‘microinsurance’ cover

• Loan and saving protection scheme setup in the 70s with assistance of WOCCU

• Payout in case of death or disability of the member• 100% of outstanding loan balance• up to 100% of savings (% depending on age at times of saving)

• Credit Union Federation covers all members of covered SACCOs

• Gradual autonomy by reduced risk sharing of overseas partner

premium

claims

80%60%40%

International wing ofsolidarity-based banking and insurance in the developing world

SACCO’s microinsurance cover anno 2010

Central-African SACCO East-African SACCO

Insured 88.275 members92 (out of 100) SACCOs

160.000 members112 (out of 203) SACCOs

Loan balance cover 100% of outstanding loan max. 500€

100% of outstanding loan max. 1.500€

Savings cover up to 100% of savingsmax. 1.125€

up to 100% of savingsmax. 3.800€+ 35% of claim to SACCO

Premium (of sum insured) 4,8% 1,2%

Claims ratio 53,4% < 100%

International wing ofsolidarity-based banking and insurance in the developing world

2011 & beyond: programme update needed

• Changed environment• Requests for increased coverage limits• Additional insurance coverage• Legal requirements

• Institutional options• Central-African Sacco: creating SACCO owned life-

insurance company• East-African Sacco: ceding part of risk to formal

insurance company

• Limitations• Technical capacity• Capital requirements• Start-up speed