Extending mutual microinsurance to 5 million uninsured households in five countries over five years.

An extra one million low-income people to be reached in India

The International Cooperative and Mutual Insurance Federation (ICMIF) has this week announced that it will be working with the Development of Humane Action (DHAN) Foundation, India, to supply an additional 1.17 million people from low-income communities with its mutual life, health, crop and livestock products over the next five years. This work will form part of phase II of the ICMIF 5-5-5 Mutual Microinsurance Strategy’s country intervention in India.  

ICMIF’s 5-5-5 Mutual Microinsurance Strategy is a five-year project based in five emerging market countries which aims to provide five million low-income households with insurance cover. The 5-5-5 Strategy has been widely discussed at meetings of the B20 and at the recently convened Insurance Development Forum (IDF). The Microinsurance Working Group of the IDF is co-chaired by ICMIF’s Chief Executive, Shaun Tarbuck.

Established in 1997, the DHAN Foundation works to reduce poverty in poor and marginal communities such as small farmers, fishing people and small traders. Through its alliances with over 62,000 self-help groups and 418 federations, DHAN reaches over one and a half million households across 14 Indian states. The Foundation has helped to raise more than 340,000 households out of poverty. Its mutual risk coverage programmes currently cover in excess of 350,000 families (Source: DHAN statistics 2016).

Drawing on almost two decades of experience, the DHAN Foundation has a well-developed, community-based mutual risk cover programme to help low-income people in India manage life, health, livestock and crop risks. DHAN’s products are complimentary to existing insurance products available on the market and have been designed to fill a gap not currently being addressed by commercial insurance companies or the government.

The DHAN Foundation was selected to take part in the 5-5-5 Mutual Microinsurance Strategy because mutuality is at the heart of all its activities. Also, it has an existing large outreach in India, its target policyholders are low-income individuals and it has a proven scalable community-model.

Consultant and qualified actuary James McPherson of UK-based Vario Partners verified DHAN business plan during a visit to India in August 2016. McPherson found the business plan fit for purpose and when asked why he decided to travel to India in person to visit DHAN, rather than contributing to the 5-5-5 Strategy from afar he explained: “My role was to provide a verification report on the business plan and provide reassurance to others who may wish to rely on the report. I think it was essential to go and see the environment and operations in action.” Prior to joining Vario Partners, McPherson was a partner with PricewaterhouseCoopers (PwC) and this was when he first became involved with ICMIF’s development work.

India was selected to take part in the 5-5-5 Strategy because it is a front-runner in the provision of microinsurance, the country has a high incidence of poverty and finally ICMIF has a strong member presence in the country. Phase I of the country intervention in India began with the launch of the Uplift Mutuals project in August 2016. The Uplift project is being supported by ICMIF members The Co-operators, Canada;  Länsförsäkringar, Sweden; and the Achmea Foundation, the Netherlands.

ICMIF members interested in supporting the DHAN project through the provision of financial and/or technical assistance can contact Sabbir Patel, Senior Vice-President, Development, ICMIF, to request a copy of the project proposal: sabbir@icmif.org.