GIIF is funded by the European Union, Japan and the Netherlands.
The EU is the primary donor partner to the GIIF Trust Fund with a focus on the African, Caribbean and Pacific Group of States (ACP). The governments of Japan and the Netherlands are providing additional support to different regions/countries where IFC operates.
GIIF works both with private sector and public sector players in order to build index insurance markets.
On the private sector side, the GIIF IFC Team funds implementing partners comprised of an intermediary “broker/agent” who develops index insurance products with local and regional insurance companies who then sell the products. The index insurance products are often bundled with loans or credit and distributed mostly through portfolio-level aggregators such as agribusinesses, banks and microfinance institutions, and cooperatives.
On the public sector side, the GIIF WB Team works closely with governments at the regional and national level on policy issues to create an enabling legal and regulatory environment for index insurance. The GIIF WB Team also carries out feasibility studies and index insurance pilots to test the feasibility of index insurance markets.
East and Southern Africa
In East and Southern Africa, GIIF has funded four private sector implementing “broker” partners to build index insurance markets in three countries:
In West Africa, GIIF has funded one private sector implementing “broker” partner to work in four countries.
Microinsurance coverage in Africa has grown tremendously over the past several years. As of 2011, microinsurance products are estimated to cover over 44 million people (lives and properties) in 39 African countries – just over 4 percent of the continent’s population. The market remains dominated by life coverage in Southern and East Africa while Western Africa is on the rise (due to growth reported in Nigeria and Ghana, and to the great number of people covered by health insurance).
The microinsurance market remains limited in Western Africa with only 4.4 million people covered (life and properties) [See Briefing note, the Landscape of Microinsurance in Africa 2012, Munich Re Foundation] While agriculture represents a large portion of the GNP and employment in West African countries, crop insurance remains under-developed compared to Central and East Africa. A new legal framework dedicated to microinsurance, with a specific provision on index insurance, has been adopted by the CIMA in 2012 and should be conducive to developing index crop insurance in the region. Nevertheless, the Sahalian region is one of the world’s regions with the highest variably of rainfalls, which makes crop insurance necessary but difficult. Donors and local institutions in West Africa are keen to develop index crop insurance. The CNAAS, AMAB, Allianz and PlaNet Guarantee are pioneers for developing and distributing index crop insurance in this region.
On the public sector side, GIIF has worked on creating an enabling legal and regulatory environment at the regional level through CIMA (regional insurance industry body for West Africa) and supported three countries with feasibility studies and index insurance pilots.