For the insurance industry, 2008 is more often reminiscent of the bailout of AIG than of new beginnings. However, 2008 also launched an unexpected wave of creative destruction. This essay series not only celebrates the 10-year work of the Center for Financial Inclusion, but also  several pioneers that strive to make insurance inclusive for all: the ILO’s Impact Insurance Facility, the Centre for Financial Regulation and Inclusion and the Microinsurance Network—all of which began a decade  ago.

As a more recent settler on the inclusive insurance planet – although almost three years have flown by – others may keep the flame, but I would like to offer a personal opinion on the past decade of innovation, and my perspectives into what more needs to happen to combine sustainable business and social impact for those who need insurance most.

Back in 2008, microfinance institutions predominantly distributed what was then called microinsurance. MFIs provided insurers with a readily available pool of clients for credit life insurance, which reimburses the outstanding loan amount in case of death or disability of the borrower.

This was the first era of inclusive insurance.

Ten Years Gone, Ten Years to Go: Taking Inclusive Insurance from Adolescence to Adulthood

Getting Inclusion Right

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&gt; Posted by Center Staff

<a href="https://www.flickr.com/photos/55267733@N04/8378728848/"><img class="aligncenter size-full wp-image-16718" src="https://centerforfinancialinclusionblog.files.wordpress.com/2014/11/8378728848_b5044892c0_b.jpg" alt="A mother and child stand outside a health clinic where they both received check-ups and necessary vitamins and vaccines. Great Rift Valley Region, Kenya" width="490" height="367" /></a>

In Kenya, where public health insurance has been available since 1965 and access to health care is a constitutional right, only <a href="http://www.worldbank.org/en/news/feature/2014/10/28/improving-healthcare-for-kenyas-poor">20 percent</a> of the country actually has access to some sort of medical coverage, according to the World Bank. With a population of 44 million, this means that 35 million are excluded from coverage and millions are unable to afford services at private or public health facilities. In terms of the money spent, about one quarter of health care services spending in Kenya comes out of pocket. Each year, about one million Kenyans fall below the poverty line because of health care related expenses. Recent investments in the industry indicate that this grim reality could be changing, however, and soon.

A few days ago fund manager LeapFrog Investments <a href="http://www.ventures-africa.com/2014/11/leapfrog-set-to-acquire-east-african-health-insurance-firm-for-18m/">bought a majority stake</a> in Resolution Insurance, Kenya’s fourth largest insurance provider, for $18.7 million. The new funds will go towards realizing Resolution’s growth strategy of diversifying product offerings and extending services access to more Kenyans and other East Africans. The investment comes at an exciting time for both investors and providers. Though coverage remains low overall, the industry is growing rapidly. The non-life insurance market in Kenya is expanding at 20 percent annually, with health insurance at 38 percent annually. The deal is currently undergoing final regulatory processes.

Beyond Resolution Insurance, LeapFrog recently raised $400 million which it says will go toward investments in financial services across Africa and Asia, with a quarter of funds reserved for East Africa.



A few months ago, the Kenyan government, in partnership with the IFC, UKAid, the Gates Foundation, and others launched a collaborative <a href="http://www.worldbank.org/en/news/feature/2014/10/28/improving-healthcare-for-kenyas-poor">Health Insurance Subsidy Program</a> (HISP). The program offers Kenyans health insurance subsidies for coverage of care at public and private facilities. Administered through Kenya’s National Hospital Insurance Fund under its Ministry of Health, the first phase of the program covers 125,000 Kenyans and 23,500 families. These lower-income individuals were selected by the Ministry of Labor, Social Protection and Services to ensure that the program was addressing those in need.

Of the program, Cheikh Oumar Seydi, IFC’s regional director for East and Southern Africa said, “HISP is part of the World Bank Group’s Health in Africa Initiative’s support to the Kenyan Government’s priority agenda of achieving universal health coverage by expanding medical cover to the poorest and vulnerable.”

If successful, HISP will scale up to include nine million Kenyans.

Photo credit: <a href="https://www.flickr.com/photos/55267733@N04/8378728848/">Julia D/Flickr.</a>

Have you read?

<a href="http://cfi-blog.org/2014/10/06/bundling-mhealth-info-and-microinsurance-to-improve-health-outcomes-in-kenya/">Bundling mHealth Info and Microinsurance to Improve Health Outcomes in Kenya</a>

<a href="http://cfi-blog.org/2014/08/15/300-households-for-one-year-results-of-the-kenya-financial-diaries/">300 Households for One Year – Results of the Kenya Financial Diaries</a>

<a href="http://cfi-blog.org/2014/03/05/balancing-client-value-and-the-business-case-in-kenyan-health-microinsurance/">Balancing Client Value and the Business Case in Kenyan Health Microinsurance</a>

Kenya Edges Closer to Universal Health Coverage

Kenya

Garance Wattez-Richard

The majority of Kenyans have mobile money accounts; their activity demonstrates digital financial services’ potential. Accion helps Kenyan innovators harness emerging technologies to create new financial services.

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Ten Years Gone, Ten Years to Go: Taking Inclusive Insurance from Adolescence to Adulthood

Kenya Edges Closer to Universal Health Coverage