Access to Insurance Initiative A global programme for sound regulatory and supervisory frameworks

1. Access to Insurance Initiative A global programme for sound regulatory and supervisory frameworks How the Access to Insurance Initiative contributes to financial inclusion 25 April 2013, Panama City XXIV Annual ASSAL General Meeting Martina Wiedmaier-Pfister, Policy Adviser to A2ii on behalf of German Federal Ministry for Economic Development and Cooperation (BMZ)

2. The Initiative • Joint programme of 10international development agencies and IAIS (International Association of Insurance Supervisors) • Unique relationship triggers the reforms in regulation and supervision required for the development of inclusive insurance markets

3. Rationale of the Initiative • Policy makers increasingly commit themselves to improve access to financial services for the poor (G20/ GPFI) • Regulatory and supervisory frameworks are not yet conducive for spurring access to insurance • Supervisors strive to facilitate insurance for the underserved and its product lines, suppliers and clients • Strengthening institutional and regulatory capacity is essential to improve access to insurance

4. Dimensions of Financial Inclusion • IAIS Application Paper para 1.9. • “Financial inclusion” refers to a state in which all working age adults have effective access to credit, savings, payments, and insurance from formal providers. (Global Partnership for Financial Inclusion) • “Effective access” involves convenient and responsible service delivery, at a cost affordable to the customer and sustainable for the provider, with the result that financially excluded customers use formal financial services rather than existing informal options[1] From: World Bank Financial Inclusion strategic Framework for GPFI 4

5. 4 – Advocacy and International Platforms 3 - Contributing to IAIS standard-setting Phase 1 of the Initiative 1 – Building knowledge and learning • International dialogue events • Thematic research • Synthesis project Capacity Development • Conducive • policy and • regulatory • environment • ↓ • Improved • access to • insurance 2 - Undertaking country projects • Country diagnostics • Stakeholder processes • Implementation projects • Toolkit development • IAIS Issues papers • IAIS Application papers • Toolkit on self-assessment • Cooperation with IAIS committees • Access themes in the ‘G20 ‘Financial Inclusion Process’ and SSB Workstream • IAIS-Microinsurance Network-Joint Working Group

6. Achievements

7. Achievements

8. Achievements

9. Achievements IAIS Application Paper Inclusive Insurance Background: ICPs applyto supervision in all jurisdictions and business lines; however, certain supervisory requirements and actions need adjustment in accordance with the nature, scale and complexity of the risks posed by the individual insurer (“proportionality principle”) Five interrelated issues: • Formalisation of informal providers / use transitional arrangements • Facilitation of innovations that overcome barriers to access • Proportionate application of ICPs (nature, scale and complexity) • Allocation of clear roles and responsibilities • Considerations for a definition See: IAIS Application Paper on Regulation and Supervision supporting Inclusive Insurance Markets (Oct. 2012) www.iaisweb.org/Application-papers-763 9

10. Current Projects Component 1: Country Diagnostics, Dialogue and Private- Public Consensus Four-country project in Latin America • Peru • Colombia • Jamaica • Brazil A2ii and Component 2: Development and Implementation of Regulatory Road Maps Component 3: Learning, Communi- cating and Catalyzing 10

11. Current projects Global projects in 2013: • Financial Inclusion Training module • Self-assessment and peer-review on regulation and supervision supporting inclusive insurance markets • Thematic notes on a) business models/intermediation and b) current regulatory approaches • Impact assessments of regulatory reform • Contributions to Financial Inclusion Subcommittee of IAIS (Issues Paper Market Conduct, Distribution and Consumer Protection) 11

12. Thematic Note on business models 12

13. Thematic note on business models 13

14. New Strategy Phase 2 Phase 1: first 3 years: awareness raising, knowledge gathering and dissemination- knowledge hub PLAN: A2ii becomes an implementation partner to IAIS on access to insurance Phase 2: toward sustainability: producing and enabling the use of knowledge supervisors need- supervisory support

15. New Strategy Phase 2 • Proposed Mission/Vision: • We are the implementing partner of the IAIS to increase access to insurance. We inspire and support supervisors to promote inclusive and responsible insurance, reducing vulnerability.  • The Initiative aims to increase access and usage of insurance by 10 % in IAIS member jurisdictions and beyond, over a period of 6 years • To achieve this the Initiative will set up a supervisory support facility of USD 50 million

16. New Strategy Phase 2 • IAIS/A2ii partnership will make the insurance sector stand out as the globally leading model for promoting financial inclusion • Many IAIS members have high levels of financial exclusion making financial inclusion a fundamental priority for IAIS • IAIS has an established process of implementation of its standards but lacks the resources to offer supervisory support to its members 16

17. IAIS STANDARDSETTING New Strategy Phase 2 Assessment Self Assessment and Peer Review, Surveys (eg Supervisory Development Survey), Input from regional coordinators and implementation partners (eg FSI, A2ii) Financial Inclusion Support application of ICPs for inclusive markets linked with IAIS Standard Setting and Implementation. Direct link with A2ii Supervisory Cooperation Support cooperation between supervisors through MMoU, Repository of Supervisory Colleges, etc. Feedback to Standard Setting Activities Ongoing Monitoring Targeting monitoring of implementation activities and progress. Supervisory Development and Capacity Building Targeted seminars, training material, leveraging partners 17

18. Discussion   • Discussion on cooperation ASSAL members and A2ii • Cooperation between A2ii and ASSAL members on new strategy • Invitation to participate in A2ii projects: • IAIS self-assessment and peer review • Financial Inclusion Training Module • Others (impact, synthesis) 18

19. Thank you for your attention! www.access-to-insurance.org