Helping Communities Manage risks from the ground up.

2 years of MIA - Editorial

We are glad to share with you our latest issue of Micro Insurance Voices issues on the occasion of the 2nd anniversary of the Micro Insurance Academy!

In just two years the MIA has become a leading actor in the field of microinsurance. We are now known internationally for the unique combination of action-oriented quality research on micro health insurance and our broad effort to roll out implementation projects with local partners at grassroots level in South Asia, with the vision to reach beyond the sub-continent in the near future.

7 months have passed since our last issue of Voices and as a result we have a packed edition which will provide you with an overview of our recent work and progresses.

• The issue begins with a message from our Chief Trustee, on the occasion of our 2nd anniversary.

• Our lead article concerns a recently launched EU-funded project in which MIA and its consortium partners will implement community-based health insurance and measure its impact. Over the next 5 years, the project will bring community based health insurance (CBHI) to dozens of villages across three deprived states in India, and help the sector as a whole reduce some of the knowledge gaps about the impact of microinsurance.

• This adds to a already diverse portfolio of research and implementation projects in India and Nepal. In this issue, we bring you Updates From the Field, this time from Orissa (India) and Nepal.

• Other new important partnerships between the MIA and groups such as DGRV (the German Cooperative Union), and Grameen Vikas Trust, will broaden our involvement by taking the MIA to new locations and thematic areas. We are excited to share these issues with you in some detail in this issue of Voices.

• Sectoral initiatives and Global Advocacy remain high on part of our agenda, and in this issue we will take you around some of out recent initiatives with the Microinsurance Network (Insurance Education and Impact Assessment Working Groups) as well as some of our latest global advocacy efforts across the globe.

• Finally, we are glad to announce the MIA team has grown considerably in the last few month, and we are now a 40-members strong team. In the “May we introduce...” section of this issue of Voices we feature an interview with MIA's new Deputy Director of Training, Mr. Raj Kamal Mukherjee. Also notice that we continue to grow and this edition of Voices highlights two new vacancies at the MIA (see left side bar for announcements).
  

We hope you will enjoy this new issue of Micro Insurance Voices and thank you for taking the time to keep updated about our work in progress and send us feedback.

With best wishes,

Your friends at the Micro Insurance Academy

Message from the Chief Trustee on the 2nd anniversary of the MIA

"A social business is not a charity. It is non-loss, non-dividend company with a social objective. It aims to maximise the positive impact on society while earning enough to cover its costs, and, if possible, generate surplus to help the business grow. The owner never intends to take profit for himself".

Two years ago to the day, on 20th August 2007, the Micro Insurance Academy, a project of “Sarvajan Unnati Bodhini” Charitable Trust, launched its activities with the resolve to reach out to poor persons and communities all over India and empower them to play an active role in gaining access to sustainable health insurance cover, adapted to local needs.

We set out to achieve this objective in an original and daring way: By explaining, awareness creation, and building motivation of grassroots communities to engage in the process of establishing and operating their own micro insurance units (MIUs). We did not aim to bridge the gap between commercial insurers and grassroots uninsureds in the classical manner that agents and brokers do. Rather, we embraced the principles of mutuality in risk sharing, partnership and group solidarity, minimizing inherent or potential conflicts of interests in the insurance value-chain, and customization of the package to local needs and local ability to pay. This course of action required the MIA to innovate the business process of introducing insurance. Many obstacles had to be overcome. Our dedicated band of researchers, social activists, and social entrepreneurs has much to show for, and the Trustees can be very happy that this project has moved as well and as fast as it has, so far.

In 2009, there is a sense that health care reforms are the order of the day, not just in India or for the base of the pyramid. The key issues are how to cover the compelling needs of many uninsured, but also creating non-profit health insurance co-operatives that could negotiate coverage collectively for their members, and add value to members in part by funneling profits back into the system. In the USA, President Obama is spearheading the movement of collective initiatives for healthcare reforms, saying “What is essential is that health insurance reforms must lower costs, ensure that there are affordable options for all Americans, and it must increase choice and competition in the health insurance market”. The challenge there is providing suitable health insurance and to 46.6 million uninsured (15.9% of the US population).

In India, the situation is even more precarious, with the number of uninsured that should be reached is more than tenfold, or over 466 million. Today, many of the poor have no hope of availing even the primary health care facility they need. This stupendous task requires us to find ways urgently to organize people and muster collaboration in new ways, even without precedence, that will offer location-specific solutions. When MIA meets well-meaning individuals and organizations, we often encounter questions on what can be done. We request them to appreciate that the MIA alone cannot offer a total solution to an issue that has been too difficult for bigger and richer players. At the same time, we wish to impress upon our interlocutors that the truly risky strategy is to do nothing or to shy away from innovation. We call upon the SHGs, NGOs, and voluntary bodies to come forward and join MIA in working with community-based participatory bodies to form MIUs and accompany this with action-oriented research

The Micro Insurance Academy has been able to send this message across backward communities in states like Orissa, Bihar, Uttar Pradesh, Madhya Pradesh, and Rajasthan, through the initiatives of social organizations such as, Mahashakti Foundation, Nidan, BASIX, BAIF, and Shramik Bharati. We have the support and patronage of international bodies like Misereor, European Union, Erasmus and Cologne Universities, Rockefeller foundation, Humanistisch Instituut, Save the Children in Nepal, AWO International, DGRV, through logistic support and funding. We are indebted to them. Among Indian institutions cooperating with MIA, special mention must be made of the Gramin Vikas Trust, a Trust of Krishak Bharti Cooperative Organization for its active participation and financial support.

All these have helped us to assemble a team of dedicated activists and researcher, volunteers and field personnel, under the leadership of Prof. Dr. David Dror, Dr. Iddo Dror and Mr. Ralf Radermacher. On behalf of my fellow trustees and on my own behalf, I take this opportunity to thank the leaders and staff of MIA for their untiring efforts, and wish them continued good speed in advancing their mission.

With warm greetings!

Dharmendra Kumar

Implementing community-based health insurance and measuring impact.

Starting July 2009, some of the world's leading experts in the field of micro health insurance have united forces under the auspices of the European Commission Research Directorate to combine implementation with impact evaluation in the field of microinsurance.

In this EU-funded, 5-year collaborative project the Micro Insurance Academy partners with two top European universities (Erasmus University Rotterdam, University of Cologne) and three pioneer Indian grassroots organisations (BAIF Development Research Foundation, Nidan, Shramik Bharti) to take up a research effort unprecedented both for its academic scope and potential impact on current sectoral practices.

By combining the rollout of three new showcase micro insurance units (MIUs) and an unprecedented emphasis on scientifically rigorous evaluation of their impact on the lives of the target population in terms of equitable healthcare access and financial protection over several years, this project seeks to build a solid and comprehensive knowledge base for micro health insurance initiatives.

Implementation and Research - the two pillars of this project - will progress side by side in this 5-year project.

On the implementation side, the MIA will support BAIF, Nidan and Shramik Bharti to establish three Community-Based Health Insurance (CBHI) schemes in Kanpur Dehat and Pratapgarh Districts in Uttar Pradesh, and in Vaishali Discrict in Bihar. The CBHI schemes to be implemented will be based on MIA's innovative micro insurance model, stressing inclusiveness (en-bloc affiliation against adverse selection, collaborative design of the package and community-rating mechanisms), sustainability (self-administration of the scheme) and solidarity (social-capital as a response to moral hazard and other market/insurance failures).

In a parallel effort, a continuous assessment of CBHIs' impact on the target population will be undertaken, testing the scalability and reach of the model across diverse socio-economic local patterns. Through the use of diverse methodologies (quantitative, qualitative, field observation, economic experiments, spatial data and structured data on the costs of economic implementation) the consortium will assess various dimensions of impact of the schemes as well as enhance the understanding of increasing efficiency of implementation. Some of the main questions that will be explored include whether being affiliated to an MIU improves access to healthcare and what impact on health-related financial exposure does this insurance have, due to a reduction of out-of-pocket healthcare spending among low-income rural households.

The balanced mix of skills and perspectives represented in the consortium is set to be uniquely far-reaching. Beyond answering the sectoral need for scientifically more rigorous theoretical frameworks, the project aims at offering precious policy-relevant insights into micro community-based insurance.

The findings will hopefully enable to understand cause-effect relations between insurance status and healthcare-seeking behaviours, health status and financial exposure due to catastrophic events, the impact of micro insurance on the local healthcare supply and many other areas of crucial medical and socio-economic relevance. Read more about our funding agency, the advisory board and our partners...

MIA launches a strategic partnership with the German Cooperative Confederation (DGRV) !

In another major effort to strengthen the micro insurance sector through the merging of converging expertises, tools and visions, MIA has established a strategic alliance with the DGRV - the German Cooperative and Raiffeisen Confederation.

• the state of self-regulation and supervision mechanism in the sector;
• new tools and applications for mutual insurance schemes (including livestock insurances and other assets);
• an implementation showcase affecting up to 10,000 individuals in rural contexts; and, finally,
• advocacy initiatives on the public policy front.

The multi-level approach aims at integrating a number of different initiatives at the micro, meso and macro level, thus aiming at strengthening the links between grassroots work, sectoral development in terms of outreach resources and high-profile policy advocacy activities.

Who's who? Meet our partner !

With over 20 million associates, the DGRV is the largest member-based economic organization in Germany. It works as both the apex and auditing association of the German cooperative organization and represents the concerns of all cooperative sectors in matters of economy, law and tax policy. It also advises the Union on questions of management organization, data processing, and training systems. Visit the DGRV website!

The MIA unites forces with Gramin Vikas Trust to develop Research and Implementation projects in Madhya Pradesh, India

The Micro Insurance Academy: spotlight on global advocacy.

Disseminating quality knowledge is an integral part of our mandate and to accomplish this we struggle to be at the forefront of the major global and regional events in the field of microinsurance.

In the last few months...

Invited to give a keynote address at the opening of the 3rd Asian Conference on Microinsurance held in Beijin (22-23rd of July 2009), Prof. David Dror, Chairman of the MIA and Professor of Health Insurance at Erasmus University Rotterdam, made a case for the strategic role of the insurance industry in enhancing and multiplying micro insurance initiatives. The core learning he put forward to the audience was "let each do what they can do best", advocating the need to explore further cross-sector synergies and shared interest among all stakeholders.

Earlier this year, in May, the MIA was invited as resource agency for microinsurance to the UNDP/UNCDF Workshop on Financial Inclusion in Colombo. MIA's Director of Research & Training, Ralf Radermacher, delivered the lead presentation in a session on microinsurance entitled "Building Security for the Poor: Microinsurance". The workshop was attended by UNDP and UNCDF representatives from the Asian region and Pacific, who discussed microinsurance as part of their Financial Inclusion strategy. As MIA's presentation raised interest among many country representatives, the MIA is glad to continue the dialog with the UNDP colleagues!

Sector update: Global Survey on Insurance Education launched !

As facilitator of the Insurance Education Working Groups of the Microinsurance Network (MiN), the MIA has been at the forefront of a global Insurance Education survey.

With more than 800 respondents to the tri-lingual on-line survey, we obtained crucial information and insights on how to reduce duplication of efforts, enhance communication and facilitate sharing among micro insurance organizations on Insurance Education.

Topping the regional distribution of responses, Asia came first with130 replies from insurers, community-based NGOs, MFIs and CBOs active in the field of microinsurance. African organizations came second with 45 responses from Senegal, Cameron and Ivory Coast, followed by Europe, South America (with 12 responses from Columbia only), North America.

A preliminary analysis of the responses shows that most respondents , their differences in context and approaches notwithstanding, share the common objective of improving the living standards of clients by enhancing their understanding, trust and behavior when it comes to managing risk through (micro) insurance schemes.

Respondents across the globe also seem to share the same need for boosting dialogue, contacts and the sharing of expertise.

In the next stage of the survey, researchers from the MIA and othe MiN members will conduct depth phone interviews with key stakeholder in a coordinated attempt to deepen our understanding of the actual level of expertise, the diversity of practices and the shared needs of the sector.

Last but not least, the survey's final output will result in the launch of a Virtual Library with all Insurance Education materials and tools respondent organizations are willing to share. This will create a one-step multilingual resource database and a networking hub for stakeholders around the globe. We look forward to circulate the final results of the Survey and seeing the Virtual Library on-line and running! Read More about the MiN Education Working Group, its members and aims.

Sector update: Impact Assessment Working Group gets boost from ILO-funded Fellow

Since nearly two years the Micro Insurance Academy is engaged in facilitating the activities of the Impact Working Group at the Microinsurance Network.

This working group of about 30 impact-assessment experts has set for itself the objective of supporting the creation of better evidence data though mainstreamed assessment frameworks to measure the impact microinsurance has on its clients.

Striving towards this goal, the working group is now engaged in formulating mainstream impact assessment guidelines and indicators which can serve as benchmark and help improve the quality of evidence research activities in the microinsurance space.

To support this sweeping task, the ILO Microinsurance Innovation Facility has decided to place a "Microinsurance Fellow" at the MIA for one year. The fellow for 2009-10 will be Theresa Chen. Theresa gained experience in impact assessment in the microfinance sector and has relevant experience evaluating government programs. She will support the working group starting on September 2009.

Updates from the field: Nepal

• A new Baseline Survey opens for new implementation projects in two districts in Nepal

Having secured excellent cooperation with leading MFIs and NGOs for the implementation of community-based microinsurance schemes in Nepal, the MIA and Save the Children carried out a Baseline survey in two Nepalese districts.

Starting March 2009, an Household Survey and a Qualitative survey (through Focus Group Discussions and Key Informant Interviews) were carried out in the districts of Dhading and Banke, Nepal, covering a total of 2008 households and 10912 people. The qualitative survey alone consisted of 40 Focus Group Discussions (involving both groups of men and women) and 51 Key Informant Interviews (carried out with traditional healers, providers in public health facilities, grassroots governmental health workers and auxiliaries, private hospital providers, local pharmacies, pathology laboratory providers and district hospital representatives) across the two districts.

The fieldwork was carried out in cooperation with (and among the members of) our local partners DEPROSC and NIRDHAN respectively, and had to face the challenges of difficult access to hilly areas and ethnic unrest causing frequent 'Bandhs' (general strikes).

The survey data is now being analized, and first results will be available soon. In this instance we decided to carry out both quantitative and qualitative analysis in parallel. A detailed Baseline Report documenting the findings will be available to the partners by the end of Aufgust, and the MIA, together with Save the Children and the local parteners will convene a National Policy Conference in Kathmandu by the end of September 2009.

Updates from the field: Orissa, India.

The Mahashakti Foundation (MSF) is rolling out MIA's community-based micro health insurance model in Kalahandi District, one of India's most under-served and difficult regions.

Earlier this year the MIA put forward its community-based micro health insurance model as a potential way to launch implementation of micro health insurance by the Self Help Groups' members of the Mahashakti Foundation. The discussion that followed provided the opportunity for the SHG members and MSF to consider and decide on what insurance model would be best suited to the local context.

The MIA has now completed the Initiation Workshop. The topics discussed included different types of delivery models, the objectives and scope of such models in operation, the insurance parameters, the existing local ground structure, and the issue of sustainability. The workshop resulted in a roadmap for the implementation of the chosen micro insurance scheme, including timeframes and steps to be followed.

Currently, MSF is rolling out an Awareness Campaign, a crucial step towards preparing context-tailored explanations on media like posters, songs and slogans. A series of workshops will also prepare facilitators from the community to start the awareness-raising process on the specifications and potential benefits of the community-based microinsurance scheme. During the Awareness campaign, trained SHG members will conduct sessions among other SHG members and their families about the need for and importance of microinsurance.

"May we introduce...…" R.K. Mukherjee, MIA's Deputy Director of Training

In this issue we have the pleasure to introduce you to our new Deputy Director of Training, R.K. Mukherjee, who shares with us in this interview his insightful perspective on the core challenges of working in the sector of microfinance in India, and why the MIA's distinctive method is set to change the pace of microinsurance initiatives.

What does you personal and professional experience tell you about the key for success in the sector of micro insurance?

Coming from the public bank sector and having later worked for over a decade with Micro Finance organizations in India, I believe that availability of a systemic methodology is the truly effective key to successful grassroots initiatives. In India, many initiatives were born out of good intentions but do not achieve the goals because they lack precisely a tested method and a model on which to rely.

Another crucial element is the existence of rooted 'last mile' institutions, and, finally, I would mention effective communication strategies: once an initiative and its promoters are introduced effectively and transparently, any poor community will be eager and receptive to their propositions and ideas.

How does the MIA approach differ, and what is it all about?

The MIA is today 2 years old but it is building on a long legacy of distinct academic and empirical evidence based efforts to design bottom-up alternatives to formal systems of risk management. At MIA, what we look at is to help people excluded by formal systems (banks, insurance companies, etc) to manage risk effectively, without putting in jeopardy their lives or assets.

On top of this, MIA's specific approach to micro health insurance is a step forward from Micro Finance initiatives: it does not rely on the availability of upfront funds but it seeks in fact to manage unforeseeable expenditures on healthcare needs. We are also scoping the opportunity of expanding the insurance model to livestock and other assets of low-income communities.

How important do you think it is to understand local specificities when planning interventions?

Understanding local specificities is a painful process, but a crucial one, whenever you strive for effectiveness and impact at grassroots level at least. It entails many different challenges, from grasping the prior understanding the target population has of insurance tools to understanding how to convey our vision and the potential benefits of micro insurance schemes for the community in the most effective way. I will give you an example, everybody knows the Life Insurance Corporation of India, but their experiences or the idea they have might entails prejudices on the potential benefit they could personally get from joining an insurance scheme.

Training tools and resources must then be designed based on a fine understanding of the local specificities in order to address those specific persons involved in the rollout process. For the MIA, each end user of the microinsurance scheme is a member of a community with specific needs and means, not an hypothetic buyer of standard insurance product, this is a fundamental point.

Any other challenge you face when designing implementation initiatives? How does the MIA tackle these difficulties?

Another challenge is the unique level of diversity in local culture and understanding of collective action we need to face, and how to adapt our model to it: different social dynamics entail different approaches, according to local mindsets and understanding of empowerment and leadership concepts.

The MIA is well equipped to understand local contexts as it works in parallel in a number of diverse settings (10 districts across India and 2 in Nepal) and - crucially - only in partnership with local NGOs, CBOs and other similar organisations. These are deeply rooted in the local social structure and benefit, as a result, of a direct understanding of specificities and needs of local communities. Through the methodical training and direct involvement of its partner grassroots NGOs in the rollout of the microinsurance units, MIA can affect communities with positive impact in a community-driven and community specific way. I believe this is a unique approach in India and worldwide.

Raj Kamal Mukherjee started his career in the public sector banking followed by a decade in the microfinance sector. He has worked to strengthen microfinance programs of many NGOs,directly and with ACCESS Development Services. He worked with Sa-Dhan to develop performance standards for microfinance institutions and initializing the annual sector reports, 'Side by Side' and 'Quick Report' on performance and trends in microfinance sector in India. He was a member of the committee set up by The Institute of Chartered Accountants of India to devise accounting standards for microfinance institutions. He has conducted several training programs for NGOs and microfinance institutions on issues of governance, performance monitoring and reporting. At the MIA, Raj Kamal coordinates the development of training processes and works on standard setting and advisory services to MIA's clients.