regulation of microinsurance in the cima zone: the perspectives!

Regulation of Microinsurance in the CIMA zone: the perspectives!

Manila, September 18th – 20th 2013

Regulation of Microinsurance in the CIMA zone: the perspectives!

Manila, September 18th – 20th 2013

Regulation of Microinsurance in the CIMA zone: the perspectives!

Manila, September 18th – 20th 2013

Regulation of Microinsurance in the CIMA zone: the perspectives!

Manila, September 18th – 20th 2013

Regulation of Microinsurance in the CIMA zone: the perspectives!

Manila, September 18th – 20th 2013

Summary

Portrait of microassurance

Regulation of microassurance

Perspectives

Portrait• Principal risk holders

– Associations– Non Governmental Organizations (NGO)– Microfinance Institutions (MFI)– Insurance companies– Health Mutuals– Populations– Government

Portrait

• Risks covered – Health insurance : health care, hospitalisation,

critical illness …– Life insurance : credit-insurance, term life, total

and permanent disability and accidental death– Casualty insurance: house, car, stock, …– Agricultural insurance: fishing, livestock, crop,

harvest, …

Portrait

Bénin BurkinaCameroun Congo Côte Ivoire Mali Niger Sénégal Togo

2.30%

1.30%1.70%

0.78%0.38%

0.73%

0.00%

6.00%

3.10%

Percentage of people and goods covered by microassurance

Portrait: for the CIF

2008 2009 2010 2011

3,640

4,2704,536

4,958

329 372 439 474

Primes (000 €) Nombre de contrats (000)Premium (000 €) Number of contracts (000)

Regulation of insurance in the CIMA zone• The « Inter-African Conference of Insurance

Markets  » (CIMA) is the regulator body of the insurance market in 2 economic zones in Africa:

“Economic and Monetary Union of West Africa (UEMOA)”

Regulation of insurance in the CIMA zone - UEMOA

Regulation of insurance in the CIMA zone• The « Inter-African Conference of Insurance

Markets  » (CIMA) is the regulator body of the insurance market in 2 economic zones in Africa:

“Economic and Monetary Community of Central Africa (CEMAC)”

Regulation of insurance in the CIMA zone - CEMAC

Regulation of microinsurance

• Two laws govern the activity of microinsurance – Regulation No. 07/2009/CM/UEMOA dealing

with rules of social mutuality within the UEMOA

– Regulation CIMA/PCMA/PCE/2012 on microinsurance operations in member states of the CIMA

CIMA Regulation versus UEMOA Regulation

CIMA Regulation UEMOA Regulation

Legal status Limited CorporationMutual

Social mutual non for profit

Social capital or funds

Limited Corporation: 762,245 €Mutual : 457,347 € -

Authorization Approval of the Minister of Economy and Finance (Validation of the project by CIMA)

Approval by the Minister in charge of social mutuality

Branch Non-life (Casualty): Personal injury, illness, loss of crops, loss of livestock, fishing, Other agricultural insuranceDamage to propertyLife: Life, savings, retirement, disability

Health care, medico-social or cultural servicesEconomic activities to improve the living conditions of members.

CIMA Regulation versus UEMOA Regulation

CIMA Regulation UEMOA Regulation

Minimum numbers of members

Limited corporation: nilMutual : 500 members

Distributors, intermediaries

Requirement to obtain a professional license issued by the Ministry in charge of insurance

-

CIMA Regulation versus UEMOA Regulation• CIMA regulation is therefore a supranational law that

repeals all existing legislation including the CIMA Regulation

• UEMOA states continue to promote the UEMOA Regulations in contradiction with the CIMA Regulation

• The Health Mutuals in the UEMOA zone complies with UEMOA rules

• Law on Decentralized Financial Systems (DFSs) prohibits DFSs to carry on the business from another category without prior approval, including regulated insurance activities

Perspectives • Continuation of self-insurance activities by some MFIs

despite bans (Central Bank and CIMA)

• Creating insurance company by some MFIs (case for the RCPB in Burkina Faso with the participation of technical and financial partners, ....)

• Organization of Decentralized Financial Systems inside their professional structure to establish a common insurance company

• Signed distribution agreement with licensed companies (ex: agreements with Allianz Life), and in progression with societies CIF-VIE

Perspectives

• Business continuity for some Health Mutual under the UEMOA regulation

• Approval conditions under CIMA Regulation inaccessible for small-size structures

• Small-size Mutual dissolution under CIMA Regulation

• Need for UEMOA and CIMA to offer a realistic settlement

THANK YOU!