MR Microinsurance_2012_03_29.indd - International Labour ...

96 Emerging issues
the extended rains that occurred in Haiti during May and June 2011, a parametric- parametr parametricic only payout of US$1.05 million was was made to to Fonkoze. Fonkoze independently
assessed borrowers’ damage and paid out US$1.01 million to over 3 800 clients,
including loan write-off s. Fonkoze’s Fonkoze’s microloan clients have all been informed of
and received training training in the catastrophic insurance cover.
Challenges
Hazard: Haiti is exposed to various natural hazards with signifi cant loss poten- poten- poten-
tial. Earthquakes and hurricanes, as well as heavy rain, tend to to occur from time time
to time. time.
Basis risk: MiCRO covers 85 per cent of estimated basis risk up to US$1 million
per annum annum on annual aggregate aggregate basis.
Preliminary lessons learned
1. Public-private partnerships are a necessity for protecting the poor against natu- natu- natu-
ral disasters.
2. Insurance targeted at low-income populations can be off off ered in a region signif- signif- signif-
icantly exposed to natural hazards.
3. Insurance can both off er protection for an an MFI and create value for its clients.
4. Parametric covers can be supported when funding funding is available to absorb mis- mis- mis-
matches between the parametric cover and real losses experienced.
5. Training of clients is important. Fonkoze’s borrowers have all been informed of of
and received training in the catastrophic insurance cover.
Source: Adapted from Morsink et al., 2011.
Th e “macro” dimension can involve millions of people, and is typically organized
at a national or international level. Important systems are found in the
Caribbean, where the fi rst risk pool insures the governments of 16 Caribbean
countries against hurricanes and other disasters (see Box 4.6). Th e poor are
intended to benefi t from this cover, but it is the governments that are insured. In
Mexico, the state-organized Fondos have been insuring farmers since 1988 (see Box
4.7), although these tend to be richer farmers. Access for small farmers continues
to be diffi cult.