Demetria Aguilar died in May 2009, leaving her husband, Domingo, and six children. The 55-year-old Filipina had run a small tailor shop, with which she earned a large portion of the family income. She had borrowed money from a local micro-finance organisation to buy a sewing machine. At the same time she arranged for a life insurance policy through them.

'I did not know that my wife had any claim to benefits from insurance of this kind. Right after she died, the insurance explained everything to me,' says Domingo Aguilar. With the insurance money, he could pay off his wife's loan and burial expenses. Furthermore, as a widower, he was entitled to insurance benefits that helped him go on supporting his family.

'Without any safety net, people like Domingo and his family, who hardly own anything in the first place, are especially hard hit by such strokes of fate,' explains Brigitte Klein, Manager of the GTZ sector programme Financial System Development. 'When they lose their work because of sickness, or when family income is lost through the death of a family member, or when a natural disaster destroys their family's house and belongings, their whole lives can fall apart.' Few people have any protection against such risks: in the world's 100 poorest countries, only three per cent of low-income people have access to insurance.

(Photo: Peter Braumüller, Chairman of the Executive Committee of IAIS, and Brigitte Klein, Manager of the sector programme Financial System Development, cut a red ribbon to launch the Access to Insurance Initiative. Photo: Kossatz)

The question of how to improve poor people's access to risk-reducing financial services such as micro-insurance policies is therefore rising in importance on the development policy agenda. In Pittsburgh the G-20 countries, too, recently called for greater access for poor people to financial services. This could be achieved, for one, through improved regulatory and political framework conditions. One step in the right direction is the global Access to Insurance Initiative, which was launched at the end of October at the annual conference of the International Association of Insurance Supervisors (IAIS) in Brazil. Also participating in the Initiative are the German Federal Ministry for Economic Cooperation and Development (BMZ), the Consultative Group to Assist the Poor, the International Labour Organization and Finmark Trust. 'This initiative lays the foundation for a sound and sustainable partnership that expands and builds the knowledge and capacities of insurance supervisors,' explained J. Hari Narayan, who heads the Insurance Regulatory and Development Authority in India.

The Initiative supports the IAIS in developing international standards and guidelines to regulate and supervise micro-insurance schemes. 'Essentially it is a matter of capacity development for insurance supervisors in developing countries. In this way customer protection can be guaranteed and the healthy growth of micro-insurance markets promoted,' Klein explains. 'The close cooperation with IAIS, which counts among its members 140 insurance supervisory offices throughout the world, provides supervisory authorities with a forum for South-South exchange and a shared learning experience. Under the aegis of the Initiative, regional pilot measures and capacity development projects in Africa, Asia and Latin America are being planned as well, in close cooperation with multi- and bilateral donors. 'Wherever possible, we want to take advantage of synergies with existing regional initiatives such as Making Finance Work for Africa and the Alliance for Financial Inclusion as well as bilateral German development cooperation projects. This is already working very successfully in the Philippines and Ghana,' Klein continues. Within the framework of the sector programme Financial Systems Development, GTZ has already taken on management of the Initiative's secretariat on behalf of the BMZ.

'Micro-insurance provides poor people with some protection against risk. The Access to Insurance Initiative is an important step toward providing this security for all people everywhere. That is why we are so happy to support this Initiative,' says BMZ Director General Adolf Kloke-Lesch.

Further information

• Access to Insurance Initiative
  www.access-to-insurance.org