Microinsurance is a relatively new tool that can help protect people on low-income against specific perils. It works like any other insurance policy, offering a guaranteed income if crops fail, for instance, in exchange for regular premium payments.

But because, in the words of Craig Churchill from the International Labour Organisation, Microinsurance is “a new field where we are still figuring things out”, the need for some sort of coherence is pressing. Churchill was speaking in his role as the Chairman of the Microinsurance Network, which was officially launched on Tuesday 24 November at the Abbaye de Neumünster during European Microfinance Week. Minister for Development Cooperation and Humanitarian Aid, Marie-Josée Jacobs was at the launch event and clearly took pride in the Luxembourg government’s continued commitment to microfinance and development aid. “We are delighted that you have placed your trust in Luxembourg,” she told the audience at the launch. The Luxembourg connection with the Microinsurance Network goes beyond just hosting the launch, however. The network’s secretariat is based in Luxembourg and managed by ADA (Appui au développement autonome), under the stewardship of Véronique Faber.

60 members

The network was originally a working group within the Consultative Group to Assist the Poor (CGAP), but it had outgrown its informal systems and procedures and required a better organisational structure. Two years after the decision to transform the working group into a separate entity, the Microinsurance Network now counts some 40 institutional members and over 20 individual members. “It’s really important that those engaged in Microinsurance find ways of talking to each other, sharing ideas, comparing experiences and finding ways of collaborating,” says Churchill.

“The Microinsurance Network is a public good at its best. It affords us the opportunity to leapfrog across years and years of what microfinance had to go through by putting together people from various disciplines, from different philosophies and different functions, in one room,” says CGAP member Alexia Latortue, who is a member of the steering committee. The network itself is divided into numerous working groups conducting in-depth work on specific issues ranging from Agriculture Insurance to Regulation, Supervision and Policy. “By promoting appropriate regulations, highlighting success stories, sharing tools and lessons, and raising awareness among key stakeholders,” says Churchill, the network strives to enable insurance to live up to the potential to provide valuable protection to low-income households.