ICMIF

International Cooperative & Mutual Insurance

Federation

www.icmif.org

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

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”

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

Avenues for collaboration

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

ICMIF development function• Objectives

Provide support to small membersAssist cooperative bodies to establish insurance operationsIncrease access to insurance to excluded sectors of society

ICMIF development function• Methodology

ICMIF FeesTechnical expertise provided by membersDevelopment projects led by membersPartnerships with national and international donor agencies

ICMIF development function• Progress

Established 25 people-orientated insurance organisationsUnique Insurance Company – GhanaFinancial support received for Latin AmericaContract to write guidelines on microinsuranceTurkmenistan – State Insurance OrganisationHealth Mutual scheme – MaliCurrently involved in 22 countries

“Insurance is being recognized as an important tool for

poverty alleviation”

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

Providing microinsuranceThe challenges

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

Providing microinsuranceThe possibilities

• The cooperative microinsurance modelHistory of organising the poorOperate for the interest of members by membersTrust Ownership and loyaltyPeer pressureSurplus reinvested or redistributed

Providing microinsurance

• The partner agent modelNo-risk fee for microinsurance providerBetter coverage for policyholderAccess to new marketPooling of risks between informal and formal sector

Providing microinsurance

• The donor agent modelAccess to expertiseFinancial sustainabilityGuiding hand

The need in Muslim countries• Social services inadequate or unavailable• Large sectors of poverty in many Muslim

countries • Over half of world’s lowest developed countries

have a majority Muslim population• Increasing inequality in Middle East and Gulf

countries

“Takaful is the second most important social institution to counter

poverty and deprivation”

Omar Fisher,1999

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 expertiseFinancial assistancePartner-agent model

“Bear ye one another’s burden”

A Global reach for local strength

Thank you for your attention