Insurance Products for Migrants 1 INCLUDING MIGRANTS IN INCLUSIVE INSURANCE MIN Network Meeting June 22, 2016 Barbara Magnoni EA Consultants

Insurance Products for Migrants 2 EA CONSULTANTS An international consulting firm dedicated to supporting development initiatives that facilitate access to finance, to markets, and social protection for low income communities around the world We combine research and practice We have 10 years of experience in international development We gather insights + apply our expertise = to create + measure shared value

Insurance Products for Migrants All migrants’ lives are risky 3 Unsafe working / living conditions Disruption or loss of employment Uneven income streams Limited access to social services Limited social networks in host country Deportation Loss of assets Illness Injury Death Evacuation / travel costs Limited legal protection Limited education

Insurance Products for Migrants Global Picture of Migrants’ Remittances 4 Source: IFAD Most remittances flow from developed to developing countries, and these are more likely to use formal channels Remittance flows to developing countries approx. US$431 bill in 2015 Remittance growth is the slowest since the financial crisis (2008/2009) but the number of migrants has peaked to 250 million in 2015 Source: World Bank Europe & C. Asia US$42 bill MENA US$53 bill E. Asia & Pacific: US$125 bill S. Saharan Africa US$33 bill LAC US$66 bill India $70 bill China $64 bill Philippines $28 bill Mexico US$25 bill S. Asia: US$120 bill

Insurance Products for Migrants The potential for remittance-linked insurance 5 5 Source: IFAD $$$$$$$$$$$$$$$$$$$$$$$$$ US$440 bill

Insurance Products for Migrants Potential role for formal microinsurance 6 Either or both countries, covered individuals Host Country Home Country Can link to remittances Difficult to link to remittances HOME HOST HYBRID

Insurance Products for Migrants Potential role for formal microinsurance 7 Home Country Can link to remittances HOME

Insurance Products for Migrants Home Model Challenges Inadequate Products –Limited offer –Don’t respond well to most important (or salient) needs Limited or Ineffective Delivery Channels –Lack of strong community ties or networks in-country –Financially excluded –Limited (financial) education Legal, Regulatory, and Political Barriers –Complications of selling and servicing across borders –Undocumented status may affect ability to enforce rights 8 HOME

Insurance Products for Migrants Mexico-US is a well-developed remittance corridor 9 Source: CONDUSEF, Consumer Protection Agency for Financial Services, Government of Mexico

Insurance Products for Migrants Home Model Example Products –Life and repatriation services Delivery Channels –Banorte Branches (particularly in border towns) –Use the remittance transaction as a touch point for sales Legal, Regulatory –Sell policy to family member in Mexico –Dual policy-holders, on each side of the border 10 HOME

Insurance Products for Migrants Break the paradigm 11 Home Country Family, migrant b/f departure Home Country Family, migrant b/f departure Can link to remittances HOME HOST Either or both countries, covered individuals Host Country Difficult to link to remittances HYBRID

Insurance Products for Migrants The Paradigm has Shifted Source: IFAD 250 million

Insurance Products for Migrants 13 “1 in every 5 insurance clients in Spain are Immigrants” - Axa 2008

Insurance Products for Migrants 14 “48% of immigrants in Spain have insurance - 31% car, 21% life 19% home” - SegurCaixa 2008

Insurance Products for Migrants Host Model Success Factors: Example Spain Products –Car –Property –Life and repatriation services Delivery Channels –Marketing 65% below the line (social networks, social media and face-to-face) –Branches of Savings & Loans Coops –Cross sell with full product suite (savings, car loans) –Hire immigrants to offer products Legal, Regulatory –Assimilation and legalization of migrants is critical –Alliances with local service providers –Alliances with consulates 15 HOST

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Insurance Products for Migrants Protect Migrants Before they Leave Home 18 Accidental death (15,000) Natural death (10,000) Permanent/total disability (7,500) Repatriation costs in natural or man-made disasters Subsistence Allowance ($100 x month for 6 months) in case of legal problems/litigation Compassionate visit home for one family member who falls ill Medical repatriation Medical evacuation Example: Philippino Overseas Workers (OSW) requirements for recruitment agencies

Insurance Products for Migrants 19 MIGRANT ≠ REFUGEE

Insurance Products for Migrants In Sum…think about market size Home (Mexico): USD 60 premium p.a. x 11,700,000 = 702,000,000 10%= USD 70 mill Host (ex. Spain 2008): USD 377 premium p.a. x 4,661,952 = 1,968,166,200 20%= USD mill Home/3 rd party pay (Philippines): USD 72 p.a. x 10,200,000 = 734,400,000 10%= USD 73.3 mill 20

Insurance Products for Migrants 8 In sum… Host models are easier to scale Home models face huge delivery hurdles Vulnerable migrants need more than insurance to reduce vulnerability Still need significant advocacy with regulators, insurers and other actors

Insurance Products for Migrants Thank You! 22