Microinsurance, Insurance, Reinsurance: Effective Tools for Development

This note discusses the opportunities that the development of microinsurance offers and the perspectives that developing countries can expect from the expansion of insurance and reinsurance. The note states that:

• Extending microinsurance and understanding the target market is important for strengthening the sector as well as for using financial globalization in the service of the poor;
• The populations adhesion to formal insurance is possible as long as this insurance is financially, geographically and culturally available;
• The important actors of the insurance sector agree that insurance addresses one of the populations real needs: security;
• Insurance can play a role in protecting familial agriculture from globalization.

The note discusses:

• The growth of the microinsurance sector in many emerging and developing countries in Asia, South America and Africa;
• The support that some insurers give to the development of new socioeconomic networks;
• The necessity to fight the “economic insecurity spiral” that populations suffer when facing risk;
• The concept of Planet Re, a world capacity of available reinsurance, linked to the world financial markets.