Creating an enabling environment: Lessons from a decade of - PowerPoint PPT Presentation

Creating an enabling environment: Lessons from a decade of proportionate regulation Session hosted by the A2ii 12th International Microinsurance Conference Colombo, Sri Lanka 16 November 2016

State of inclusive insurance regulation 2016 Implemented 18 23 Under development AFRICA AFRICA Egypt CIMA Kenya Ethiopia Malawi Ghana Lesotho Mozambique Namibia Nigeria South Africa Tanzania Swaziland Tunisia LATIN AMERICA Uganda Brazil Zambia Mexico Zimbabwe Nicaragua Peru LATIN AMERICA Venezuela Belize Bolivia ASIA Colombia Cambodia Costa Rica China El Salvador India Guatemala Nepal Honduras Pakistan Jamaica Philippines Taiwan ASIA Bangladesh Indonesia Mongolia Pacific Fiji 2

State of inclusive insurance regulation 2009 Influenced by: Implemented 6 India China Philippines Taiwan Peru Mexico 3

State of inclusive insurance regulation Implemented 18 23 Under development Ghana : Philippines : Qualitative opt-in Multi-pronged Colombia : approach comprehensive ~29% No MI-specific framework regulation ~29% ~15% Peru : India : Multiple lessons Strong hand and revisions to ~9% make it work ~10% Coincided (not causality) with strong growth of microinsurance 4

Proportionate regulation: protecting the consumer and incentivizing the market   Entry costs Proportionate regulation   Ongoing costs Improved product simplicity  Proportionate reporting ( not necessarily easier )  Easier to understand   market by enabling better  Easier to transact distribution  Easier to claim  Embracing technology Consumer protection Provide market incentives Proportionate regulation : Balance consumer protection and market incentives/development

Key elements of inclusive insurance framework What IS  Definition inclusive insurance?  Enabling regulatory treatment  Flexible approach to distribution  Rational approach to disclosure  Balancing consumer protection

The impact of proportionate regulation in Ghana and how NIC’s role and philosophy has changed over the years International Microinsurance Conference Colombo, Sri Lanka 15 TH - 17 TH NOVEMBER, 2016

Impact of Proportionate regulation • Proportional regulation mainly applied on; o Product development and o Distribution channels Impact Over 30 products About 7.5 million lives covered (about 29% of population) 15 MI Providers

Beyond Regulation • The NIC has been involved in o Market development o Consumer Education (movies, logo, jingles) o Capacity Building

Relationship with the Industry • Consultation • Active involvement o Actuarial capacity building o Insurance awareness • Microinsurance incentive survey o Simplify MI product approval process o Lower supervisory charges o More liberalization of distribution channels

The end Thank you for your attention

Philippines: The Role of Proportionate Regulation on Microinsurance November 16, 2016 Lorenzo O. Chan, Jr. Pioneer Life Inc

Implemented Regulation Implementation of Alternative Dispute Resolution for Microinsurance (ADReM) Health Microinsurance Issuance of First Launch of Regulatory Revised definition of Regulatory Circular on Framework for microinsurance in terms of Framework Microinsurance Microinsurance premium and benefit amount 2010 2011 2015 2016 2009 2013 2006 Implementation of Micro Pre-Need Regulatory Most microinsurance performance standards Framework products (2006 -20009) for microinsurance were credit life Agriculture Microinsurance (SEGURO) Regulatory Framework Approval of simplified Agent Training and Adoption and Implementation of the Enhanced Licensing Microinsurance Regulatory Framework

Microinsurance Industry 2% Microinsurance Companies with Average Share of MICROINSURANCE Business Micro Premiums to Total Net 18 out of 67 Non-Life Premiums Written 24 out of 27 Life (2012-2014) Enrolments – Total Industry Enrolments – Micro Only Microinsurance vs. Non-Microinsurance Life vs Non-life 7.584.573 9.896.681 77% 23% 2014 2014 17,481,254 43% 57% 4.700.434 7.879.672 68% 32% 2013 2013 12,580,106 37% 63% 4.226.460 4.228.472 25% 75% 2012 2012 8,454,932 50% 50% Source: IC Presentation of 2014 data (latest available )

Microinsurance Environment Faster Product Approval Flexible pricing, not subject to tariff Set Performance Standards for Microinsurance (SEGURO) • S olvency and Stability • E fficiency G overnance • • U nderstanding of the product by the client • R isk Based Capital Ratio • O utreach

Thank you!