Nanyang Technological University (NTU), Singapore and Risk Management Solutions (RMS), Inc., California, USA, have jointly organized three Micro-insurance Round Table Forums in March 2007, April 2008 and April 2009 at the Nanyang Executive Centre of NTU. The main objective of the Forum is to discuss how to bring micro-insurance to those in the lower rungs of the income pyramid and the old in the developing countries, who are affected by natural disasters such as earthquakes, major floods, volcanic eruptions, hurricanes and tsunamis.
Whilst insurance has been introduced to this sector of the economy, both the extent and the rate of insurance penetration in this sector have been extremely low. This is due to low supply and demand, with sellers finding it unprofitable while buyers do not know much about risk transfer mechanisms. Even if the buyers know of such a product, they would think that they could not afford it. It is therefore in the vision of the Forum that new opportunities could be created to develop micro-insurance as the new service area, to provide the financial means for those in the lower income pyramid to protect themselves against catastrophic risks.
The Micro-insurance Round Table Forum is designed to focus on the following issues:
- Current work and identifying the main advocates / players / beneficiaries.
- Case studies of completed and on-going projects on catastrophe risk and catastrophe micro-insurance.
- Identifying the most urgent steps needed to make this concept implemented on a sustained basis.
- The role that insurance, (re)insurance, investment banks, governments, NGOs, international organizations (such as the World Bank), and academics can play in this effort.
- Developing and understanding appropriate loss estimation models for such a product and development of the product.
- Where do we go from here? What are the next steps?