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Media »Opening Remark at Promoting Microinsurance in Myanmar

September 9, 2019

Tom Coward, Team Leader, UK aid Myanmar Inclusive Growth and Livelihoods team



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  • Since the creation of Lloyd’s in 1686 at a coffee house on Tower Street in London, the UK has played a vital historical role in developing the global insurance industry. Insuring sailing vessels and their cargoes was one of the first applications of probability analysis to a financial product, and the success of Lloyd’s and the expanding global insurance business proved that you could hedge certain identifiable, quantifiable risks through insurance products.


  • Fast forward to the present, and insurance remains a highly relevant financial product. There are many insurable risks, and every day clever insurance professionals are identifying additional risk events and risky circumstances that can be addressed by well-designed insurance products.  There are so many ways that people and businesses can use insurance to manage their risks.


  • Turning to the market here in Myanmar, we clearly have a small insurance industry, offering a very limited range of products. But despite the small industry size, there is a clear will on the part of the Government of Myanmar to expand the insurance industry, as evidenced by recent legal reforms that have opened the market to many new international insurance companies.  Essentially, Myanmar’s insurance market has nowhere to go but up.


  • The challenge for this country’s nascent insurance industry is the challenge of relevance: how can the insurance industry respond to the needs of the market, and help business and people—all people, rich and poor alike—manage insurable risks through affordable, easily accessible products?


  • At DFID, we think it is essential to look at the development of the insurance industry through the lens of financial inclusion. The traditional approach to industry development relies on market opening, and increased licensing of foreign insurers.  The key regulators, in this case the Ministry of Planning and Finance, and the insurance regulator, the Financial Regulatory Department, could content themselves with improving the laws and regulations and expanding licensing.


  • These traditional policy-related approaches are in fact well underway, which is a very positive development for Myanmar. MOPF through FRD are providing strong policy leadership for the industry.  We believe, however, that these are necessary conditions for developing Myanmar’s insurance industry—but they are not sufficient, particularly from the perspective of financial inclusion.


  • We would like to inject a note of impatience into the discussion of how the insurance industry should develop. We should be impatient to move the industry into new products and new client segments, namely, low-income client segments. Yes, wealthier people and businesses may be more informed and more willing to buy insurance.  But we should not wait until these client segments are saturated with insurance coverage prior to moving the industry “down market”’.  To be truly relevant for Myanmar’s economic development, the insurance industry must assist low income people to manage their insurable risks.  Myanmar needs microinsurance products relevant for low income people as much as—if not more than—it needs traditional insurance products.


  • Luckily, with the advent of financial technology—fintech–there are new digital tools and business models that can greatly facilitate the delivery of microinsurance products and make it more affordable and more easily accessible for people in Myanmar. Now, if you have a smart phone—and we know that practically everyone now has one in this country—there is no reason why you cannot have access to an insurance product.


  • We are particularly delighted today to be able to hear from Stonestep, an international “insurtech” firm that has received strong support from the DaNa Facility to experiment with new products and delivery channels for microinsurance.


  • At DFID, we are very keen to work with MOPF and FRD to promote fintech approaches to microinsurance. In fact, one of the key priority areas for the upcoming Fintech Challenge Myanmar programme is microinsurance.  Note that DFID is in partnership with MOPF as Impact Partners for the FCM, which will be managed by DaNa Facility and UNCDF, both supported by DFID.


  • On the part of DFID, we are delighted to see such strong interest in microinsurance and we pledge to further support the MOPF/FRD and the insurance industry to become relevant for the majority of Myanmar’s people through microinsurance.