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Adie 20 years of activity . 53 000 business financed 63 0000 new job created Success ratio for companies over a 2 year period: 65% 22 000 active clients Portfolio: 41 405 465 € Portfolio at risk: 11%. Products and services . Micro-insurance.

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adie 20 years of activity
Adie 20 years of activity
  • 53 000 business financed
  • 63 0000 new job created
  • Success ratio for companies over a 2 year period: 65%
  • 22 000 active clients
  • Portfolio: 41 405 465 €
  • Portfolio at risk: 11%
products and services
Products and services

Micro-insurance

why did adie decided to launch micro insurance
Why did Adie decided to launch micro-insurance?
  • Adie interviewed 600 new entrepreneurs, and concluded that:
  • 1- The great majority of these microentrepreneurs, especially vulnerable to risk, do not benefit from adequate insurance coverage, posing a serious risk to their vocational activity.
  • 2- one fourth of them initiated their activity without insurance, due to:
      • -faulty analysis of their need by insurance companies and unfitted products
      • -cost
      • -lack of access to insurance (denial by insurers)
  • Moreover, for those who started out with insurance, 60% dropped out.
  • The micro-insurance product was specially designed in order to facilitate access to insurance for this vulnerable population, with a view to simplifying insurance contracts and pricing. An underlying objective is to educate them regarding insurance and its operation.
the 4 micro insurance s products
The 4 micro-insurance’s products
  • “I have a locale” for microentrepreneurs establishing themselves at a specific site. It covers:
      • - The site and vocational equipment
      • - Damages caused by the existence or exercise of the activity
      • - A financial guarantee in case of cessation or reduction of activity due to an accident or illness
  • “I work at home” for those who work at home and/or keep their vocational equipment there. It covers:
  • - Private and vocational equipment
      • - Damages caused by the existence or exercise of the activity
      • A financial guarantee in case of cessation or reduction of activity due to an accident or illness
  • Coverage of «vehicles and carried merchandises » :
  • - The basic premium is the same regardless of the vehicle.
  • - Merchandise in transport is covered up to €3,000...
  • Coverage of «construction»
  • - mandatory for building contractors.
  • - Very difficult to cover on the regular market for someone starting a new enterprise, given the absence of a track record
how did we start with micro insurance
How did we start with micro insurance?
  • 1- Partnership with AXA and MACIF, who designed a casualty insurance scheme
  • 2- Recruitment of a specialist in insurance
  • 3- An experiment has been conducted since mid-2007 in four Regions. All employees have been trained to micro insurance and products.
  • => What do we do to develop micro insurance?
      • - offer micro-insurance and its financing: loan agents propose the insurance, postponing the premium up to ten months. This postponement is facilitated by a microcredit provided by Adie
      • - inform clients about insurance
      • help in fulfilling contracts and ensuring that the insurance contracted is always appropriate
      • accompany the insured in his or her claim
what were our main difficulties
What were our main difficulties?

1-Law: which does not allow us to be insurers

2- The necessary mutualization of numerous risks in order to cop with different losses

3- Adie’s staff fear to sell a new product

4- Insurers’ fear of face to face with our clients

the main lessons learnt
The main lessons learnt

1- Partnership with existing insurers => a win/win partnership :

They bring their expertise and we know the needs of people and how to work with them:

- the microfinance institution sticks to the essence of its vocation, protects its clients and at the same time improves its credit risk

- the insurer discovers a new clientele, thus opening a new market.

2- Taking the time to define the needs of its clients in order to propose a product that is simple and adapted to the institution’s clients

3- How crucial is the training our teams in both insurance and its usefulness to the entrepreneurs.

the impact of micro insurance on microcredit activities
the impact of micro-insurance on microcredit activities?
  • Micro-insurance contributes to the goal of covering the cost of financial services:
      • - Strengthening the position of its clients ensures an improved credit risk for Adie;
      • - By income generated by microcredit contracted by clients to pay the insurance premium;
      • - Micro-insurance is a product with additional appeal making it possible to reach more clients.
the perspectives
The perspectives
  • The insurers and Adie both have to invent a new economic model . The project’s success depends on achievement of financial balance by the two parties.
  • A study defining the economic model, carried out at the end of 2008, showed it is possible for us to create a sustainable tool. Indeed:
      • - Our clients offer the insurers an acceptable risk,
  • - 1,500 new clients and 4,500 active clients would enable the insurers and Adie to cover their costs.
  • The first indicator should be reached at end-2009,
  • while the second should be achieved in 2010.
  • =>Adie is going to spread micro-insurance in every agency before the end of june 2010