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In emerging markets, the death of a business owner/breadwinner can mean financial devastation for a family, which is plunged back into poverty.

Things change when poor people have insurance. Products such as micro-insurance, agricultural insurance and index-based weather insurance are increasingly necessary as instruments for safeguarding against specific risks.

With insurance, not only can the family be protected against sudden deaths, people are also more likely to invest in expanding their farms, establishing new businesses, or sending their children to school.

A well-functioning insurance market provides tools to offset risks, to protect investment and assets, provide peace-of-mind, and through the accumulation of capital, can significantly stimulate financial markets in the country. Thus, the insurance sector can fulfill an important role in economic development, especially of emerging markets, by providing risk management services to both individuals and businesses.

However, a recent study by Swiss Re found that the 1.5 billion–person market is only 5 percent penetrated at present.

Microinsurance—the provision of affordable insurance to the poor—is now one of the world’s most demanded financial services and one that they are willing to pay for if it is accessible. This is where IFC has a critical role.

By promoting private sector investment and improved corporate government standards, IFC’s involvement through Advisory Services and investments facilitates access to finance, supports the build-up of technical skills and encourages greater competition and innovation sustainable commercial success in emerging economies.

Global Index Insurance Facility (GIIF)

An innovative program managed by IFC, and jointly implemented with the World Bank


Insurance is important for development because uninsured losses lock vulnerable populations in a vicious cycle of destitution. Unfortunately agricultural insurance and disaster insurance are either unavailable or prohibitively expensive in many developing countries .


The Global Index Insurance Facility (GIIF) is a multi-donor trust fund supporting the development and growth of local markets for weather and catastrophic index-based insurance in developing countries, primarily Sub-Saharan Africa, Latin America and the Caribbean and Asia. GIIF’s implementing partners have insured more than 400,000 farmers, pastoralists and micro-entrepreneurs and reached nearly one million with information and access to index insurance. Learn more about the innovative IFC-led program here.




GIIF is funded by the European Union, Japan and the Netherlands.

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