
15th International Conference on Inclusive Insurance - 5-7 November 2019, Dhaka, BangladeshA sleeping tiger in need of better protectionInsurance against the most important risks, including weather-related disasters, is scarcely available globally. Bangladesh – the country hosting the 15th International Conference on Inclusive Insurance – is one of the most vulnerable countries facing climate change. Extreme natural disasters like cyclones, floods and droughts threaten the livelihoods of the 160 million people living in the world’s largest delta. Despite the country’s nearly 80 insurance companies and its very strong financial sector, insurance penetration remains among the lowest, not only in the region but in the entire world. How to overcome barriers to market development in Bangladesh and elsewhere forms the focus of this year’s conference. |
Around 580 insurance and development experts from 42 countries took part in the 15th International Conference on Inclusive Insurance. |
Weather-related natural disasters threaten the livelihood of the poor not only in Bangladesh. According to the Food and Agricultural Organisation FAO, globally over 2.5 billion people depend on agricultural income – most of them living at the bottom of the income pyramid. Risk management tools based on insurance principles play an important part in increasing resilience. To better understand insurance availability, as well as any challenges and barriers, the InsuResilience Global Partnership carried out a climate and disaster risk insurance (CDRI) landscape study in 22 countries in Asia and the Pacific region, with support from GIZ-RFPI Asia. Preliminary results from the study were presented as key input for steering the discussions during the conference (see Box 1). |
Source: InsuResilience - First insights: Landscape of Climate and Disaster Risk Insurance (CDRI) in Asia and the Pacific |
The fact that 90% of the population in Asia remains unprotected, according to the study, was an eye-opener for the insurance participants. Experts agreed that insurance must be an integral part of DRM. Furthermore, the approach of using ex-post finance (e.g. from the state budget) to cover losses after disasters must shift to ex-ante planning and financing using the different micro-, meso- and macro-financial and insurance tools that are available. |
Left to right: Thomas Loster, Chairman, Munich Re Foundation; Doubell Chamberlain, Chairman of the Board, Microinsurance Network; Asadul Islam, Senior Secretary, Financial Institutions Division; Mustafa Kamal, Finance Minister of Bangladesh; HE Sheikh Hasina, Prime Minister of Bangladesh; Sheikh Kabir Hossain, President, BIA; Shafiqur Rahman Patwary, Chairman, IDRA; Bangladesh; Prof. Rubina Hamid, First Vice-President of BIA |
“Insurance companies need to play a more effective role in keeping production and the economy out of risk” said the Prime Minister of Bangladesh, His Excellency Sheikh Hasina, at the opening of the conference. According to Asadul Islam, Senior Secretary, Financial Institutions Division of Bangladesh, increased insurance outreach to 35% of the population (over 50 million people) in Bangladesh by 2025 is possible. To achieve this, the insurance and microfinance sectors need to start cooperating. Countries like the Philippines have shown that MFIs constitute an efficient distribution channel, besides knowing their customers’ needs. |
Figure 1
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What’s next? |
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