Two goals: to inspire and exchange
Natalie: Every year, BRS organises a themed workshop for partners and non-partners. The aim is to inspire the participants and let them exchange experiences with each other. This time, it was about microinsurance. The participants came from eight microfinancing institutions (MFIs) in Uganda, Ethiopia, Rwanda, Malawi and Kenya. BRS partner Trias was also present, as was Johan Tyteca, an advisor from the BRS Institute.
Alain: Microcredits offer people in poverty the opportunity to create their own income. The downside, however, is that they also come with a debt. Faisal, a father of seven children who sold aluminium pots, was in a road traffic accident, broke his thigh bone and was unable to work for several months. Without income and with a deluge of costs, he could hardly even survive, let alone pay off his credit. From our background at KBC Bank & Insurance, we want to give people like Faisal the best possible protection by combining banking products with insurance. And we do this by guiding MFIs in setting up microinsurance linked to their banking products.
Not just any insurance
Arnold: In the case of microinsurance, not only must it be financially viable, it must also offer social added value.
Natalie: You can’t just copy and paste the KBC products. Micro-entrepreneurs live at or just below the poverty line and are in a much more vulnerable situation. On top of that there are a number of social factors, such as political instability and the impact of climate change, which is much more marked in the South.
Alain: The vulnerability of these entrepreneurs means that microinsurance can’t be too expensive. And it must contain the lowest possible number of exclusion conditions. In exchange for the premium, which is not at all easy for them to pay, policyholders must receive a maximum return.
Natalie: You therefore tailor micro-insurance to a person’s situation. Because every customer has different needs.
What does your customer really need?
Arnold: That’s why we focused on the needs of MFI customers from the start of the workshop. We didn’t start talking about insurance products, we reflected on what could go wrong. Your child falls ill, your chickens die, the supplier of your raw materials stops delivering, things like that. What needs does that create? And to get a very specific picture of this, we visited the customers of MFI Vision Fund Kenya in small groups.
Alain: Our group went to see Fatuma, a woman who keeps chickens and runs a water point where people can buy tap water.
She immediately mentioned two very different needs. ‘Young entrepreneurs need support. They ask me for advice, but I’m not a coach.’ Some of her chickens also died. As a result, her income fell and she was afraid that she might not be able to repay her microcredit.
Natalie: Only after the discussions did the participants develop a prototype of an insurance product, which they presented to a jury at the end of the workshop. And we asked them to think holistically while doing so.
Alain: You could, of course, develop an insurance policy for chickens. But what about the needs of those young entrepreneurs? ‘As an insurer, we can’t do anything about this,’ the participants responded. But if you think outside the box, maybe you can. For example, can you set up a mentorship with compulsory health insurance attached to it? Of the two dollars that young entrepreneurs pay for the support, one dollar goes to a health insurance fund. In this way they get the necessary training, they’re protected and, as an MFI, you run less risk.
Arnold: All these discussions showed that listening to your customer is essential. You come up with very different solutions from what you would have imagined before.
Learning from each other
Alain: The mutual exchange of experiences was also important. During the week, each participant was able to talk about a certain aspect of their MFI’s work. Something that worked well, or indeed, something that didn’t. Because you can learn a lot from things that don’t work. And that’s precisely what this workshop aims to achieve.
Arnold: Of course, sharing personal experiences requires trust. And that trust was there, right from the start. They listened to each other’s stories with interest, took their coffee and meal breaks together and continued to stay in contact with each other after the workshop. Everyone had the same goal in mind: to learn from one another.
Natalie: At the end of our workshop, all participants received a certificate, issued by the Honorary Consul at the Belgian consulate in Mombasa. It was a lovely moment, where all I saw was happy faces.
Taking care of people
Natalie: It was an inspiring week, in a wonderful setting. Via Olivier Vanden Eynde, we arrived at the hub of his organisation Close the Gap. Young East African entrepreneurs, supported by recycled computer equipment from large companies, are working on solutions to local problems here. It’s a very dynamic and creative world, really special.
Arnold: It was above all the preparation that enriched me personally. By starting from scratch, we arrived at the needs of micro-entrepreneurs as a departure point. And from there, I saw the essence of insurance clearly again, namely taking care of what people really need. It’s so meaningful to be reminded of that.
Alain: What pleased me most is the experience that you can move a mountain with insurance, for those MFIs and in the lives of small entrepreneurs. It is very satisfying to use the knowledge and experience I gained from KBC for organisations that need it.
And we formed a terrific team of course. I thought it was great to do this with you!
