MR Microinsurance_2012_03_29.indd - International Labour ...

Teaching elephants to dance
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therefore be aligned with the higher-level strategy and business requirements.
Once a strategy for microinsurance has captured the interest of top management,
it needs to be made tangible and concrete to solicit support (or at least
to avoid active undermining) among middle managers.
Support for microinsurance can be gained by demonstrating the size of the
potential market, highlighting competitor successes, illustrating the social
dimension of microinsurance, and exhibiting the learning and innovation
opportunities. While this tactic can win the hearts and even the minds of colleagues,
it does not replace a proper authority and incentive system.
The insurer may also involve external partners such as development organizations
and distribution partners at this early stage. Opportunities to visit existing
projects and exposure to real circumstances in emerging markets through these
institutions help to create tangible experiences and images of the low-income
market and microinsurance. Exploratory initiatives, often supported by donors,
have been crucial to demonstrating the market opportunity and business models,
creating awareness, and providing material for microinsurance managers to convince
their colleagues and management of its potential.
Entering into a long-term, contractual relationship with a respected and
patient partner to jointly explore the space can bring internal legitimacy and
attention, and secure credible, long-term support within the business. For example,
under its global initiative, Zurich worked in partnership with the Swiss Agency
for Development and Cooperation (SDC) early on; Allianz and Munich Re have
formed similar partnerships with Gesellschaft für Internationale Zusammenarbeit
(GIZ); and dozens of insurers have benefited from their collaboration with the
ILO’s Microinsurance Innovation Facility. While the amounts provided by donors
are relatively small from the perspective of an insurer, several microinsurance
managers cite the political and symbolic support by public agencies as crucial to
catalysing and sustaining internal commitment and support.
19.2.2 Learning and refining models
Creating an open learning culture
As a next step to enter the market, commercial insurers need to devote time and
resources to developing skills and capacity, learning about the market, building
relationships and negotiating partnerships with relevant players.
Creating a culture of learning about the microinsurance market and a willingness
to innovate is important in building microinsurance business. Hollard, a
South African insurer that covered approximately four million low-income lives
in 2010 (Coydon and Molitor, 2011), attributes its success to its entrepreneurial