AIG Uganda
In 1996, the management of FINCA Uganda (FU), a MFI, approached the AIG Uganda to develop an insurance product for the MFI's clients. A basic product was launched in 1997, and an expanded version of the product, including coverage for the spouse and four children, was introduced in 1999.
Eight years after AIG Uganda became involved in microinsurance, this case study looks at what has become a success story in several ways. For the microfinance clients, AIG's Group Personal Accident (GPA) product has been useful and affordable in managing traumatic lifecycle events. Ugandan MFIs that participate in the scheme have generated revenues and helped improve loan portfolio quality. AIG Uganda has seen this product become its number one generator of revenue and profits to the extent that it has attracted attention across the region for AIG International. On a macro-level, the success of this programme has benefited both Uganda and the global microfinance community.
Besides the importance of actively managing product evolution, several other lessons have been learned since product inception in 1997, including:
- A microinsurance product can be developed and implemented reasonably well without external funding;
- MFIs must represent their clients in negotiations related to the insurance product.
