Microinsurance, Resilience, and the European Microfinance Award 2025

By Matthew Genazzini and Asier Achutegui, Microinsurance Network.

On March 12th, e-MFP was pleased to launch the European Microfinance Award (EMA) 2025 on ‘Building Resilience through Inclusive Insurance’. This is the 16th edition of the Award, which was launched in 2005 by the Luxembourg Ministry of Foreign and European Affairs, Defence, Development Cooperation and Foreign Trade, and which is jointly organised by the Ministry, e-MFP, and the Inclusive Finance Network Luxembourg (InFiNe.lu), in cooperation with the European Investment Bank. This year, e-MFP is also delighted to welcome as a strategic partner our friends at Microinsurance Network (MiN), who have provided invaluable support in the design and development of the EMA 2025.

It’s appropriate therefore that MiN should be the organisation kicking off e-MFP’s annual series of guest blogs on this topic, and with a very timely announcement, too: MiN has just published (on March 6th) its latest Landscape of Microinsurance, the definitive annual look at the trends, challenges and future of the microinsurance sector. In this first guest blog, Matthew Genazzini and Asier Achutegui talking about the relationship between microinsurance and financial resilience, some trends underway in that sector, a few key findings from this new paper – and what they think it means for the future of microinsurance.

In an increasingly uncertain world marked by climate shocks, economic volatility, and social vulnerabilities, microinsurance has emerged as a critical financial tool to protect low-income populations. Microinsurance (alternatively known as inclusive insurance – although with some differences) provides coverage to individuals who would otherwise have limited or no access to conventional insurance, offering a chance for financial resilience in times of crisis.

For the financial inclusion sector, integrating insurance into broader financial services is essential. While efforts have been made to expand access to savings, credit, and payment systems, insurance remains an often-overlooked component of financial well-being. Without adequate risk protection, low-income populations remain highly vulnerable, limiting the impact of financial inclusion initiatives. Insurance acts as a ‘safety net’, preventing financial setbacks from eroding progress made through other financial inclusion efforts. Ensuring that microinsurance is recognised as a core element of financial inclusion strategies can significantly enhance economic security for underserved communities.

The Landscape of Microinsurance study is an initiative conducted by the Microinsurance Network (MiN) to collect, analyse, and present data on the global microinsurance market, providing the only benchmark of this sector. The study provides a comprehensive overview of the sector, capturing insights from insurers, policymakers, and development institutions to assess market evolution, regulatory developments, and emerging trends. By examining the number of people covered, premium revenues, and innovations in microinsurance products, the study serves as a key reference point for stakeholders aiming to enhance financial protection for low-income populations. The findings help governments and insurers understand the challenges and opportunities in expanding microinsurance coverage, driving evidence-based policy decisions and industry strategies.

Microinsurance plays a pivotal role in mitigating financial risks for low-income households, smallholder farmers, and small businesses. With traditional humanitarian and government relief programmes struggling to keep pace with escalating risks, microinsurance provides a proactive solution by transferring risk before a crisis occurs. According to the 2024 Landscape report, 344 million people are covered by microinsurance across 37 countries, up from 331 million the previous year.

Beyond providing immediate financial relief, microinsurance enhances economic stability by enabling policyholders to recover from setbacks more quickly. The World Bank and CGAP have highlighted that financial resilience is critical to sustainable development, as unexpected financial shocks often push vulnerable communities deeper into poverty. According to CGAP, microinsurance complements microfinance by protecting low-income individuals from financial ruin when facing sudden medical emergencies, crop failures, or income losses due to climate-related disasters.

According to the International Labour Organisation’s (ILO) Impact Insurance Facility, microinsurance contributes to economic growth by fostering a more secure environment for entrepreneurship. Small business owners and farmers are more likely to invest in growth opportunities when they have access to insurance, knowing they have a safety net in case of unforeseen losses. For example, in agricultural economies, microinsurance products tailored to weather-related risks enable farmers to take calculated risks in adopting new farming techniques, leading to increased productivity and higher income levels.

Similarly, the United Nations Development Programme (UNDP) underscores the importance of microinsurance in achieving the Sustainable Development Goals (SDGs), particularly SDG 1 (No Poverty), SDG 3 (Good Health and Well-being), and SDG 13 (Climate Action). Health microinsurance reduces the financial burden of medical expenses, ensuring that low-income families do not have to choose between paying for healthcare and meeting their basic needs. Climate-related microinsurance products provide financial protection against extreme weather events, preventing economic devastation in regions highly susceptible to climate change.

Moreover, the Access to Insurance Initiative (A2ii) has emphasised that inclusive insurance, including microinsurance, should be integrated into national financial inclusion strategies to enhance resilience at the household and community levels. Governments and regulators play a crucial role in fostering a supportive environment for microinsurance, ensuring that products are both accessible and affordable. Financial literacy programmes and public-private partnerships are essential to promoting insurance awareness and uptake among low-income populations.

In essence, microinsurance serves as a key instrument in building financial resilience, bridging the gap between financial inclusion and risk management. By enhancing the ability of low-income populations to cope with uncertainties without falling into deeper poverty, microinsurance not only provides immediate security but also fosters long-term economic stability and growth. The increasing recognition of its role by global institutions underscores the need for continued investment in microinsurance infrastructure, regulatory frameworks, and consumer education.

• Growth in coverage: Microinsurance continues to expand, with coverage increasing from 331 million people in 2023 to 344 million in 2024 across 37 countries. This 4% growth reflects the sector’s steady progress in addressing financial resilience for low-income populations. Alongside this expansion, premium revenues grew from USD 5.8 billion to USD 6.2 billion, highlighting the increasing scale of microinsurance markets. While life and funeral insurance remain dominant, newer product lines such as climate risk, property, and income protection are expanding, with 112 climate-related products now covering over 42 million people.

• Increased donor and government support: Governments and multilateral organisations are increasingly recognising the role of microinsurance in building resilience and are backing it with financial and policy support. In 2024, the Global Shield against Climate Risks expanded its reach, offering pre-arranged protection for climate and disaster-related risks in more countries. Similarly, the United Nations Environment Programme Finance Initiative (UNEP FI) launched the Bogota Declaration on Sustainable Insurance, strengthening the commitment of insurers in Latin America and the Caribbean to support the Sustainable Development Goals (SDGs). Likewise, the Nairobi Declaration on Sustainable Insurance was introduced with similar ambitions for the African insurance sector. In addition, government and donor subsidies are playing a vital role, particularly in agriculture microinsurance, where 58% of products included in the study receive some sort of financial support, collectively covering more than 54.5 million people.

• Diversification of products: New microinsurance products are emerging to cover previously uninsured risks, particularly in agriculture, climate risk, and small business resilience. In 2023 alone, 55 new products were launched, with a majority concentrated in personal accident, agriculture, and property product lines – as Figure 1 shows.

• Long-term approach/strategy needed: Insurers, distribution channels and other stakeholders must have a longer-term approach and provide enough time to reach scale. From the data collected in the Landscape, it appears that products need at least 4 years in the market to reach to scale – as seen in Figure 2.

• Challenges in innovation and data collection: While innovation is on the rise, insurers face constraints such as limited investment, regulatory barriers, and inadequate gender-disaggregated data. Out of the 985 products featured in the study, insurers could only provide gender disaggregated data for less than half.

To overcome these challenges, microinsurance stakeholders must prioritise better data collection and product innovation.

To maximise the impact of microinsurance, stakeholders—including insurers, governments, donors, and development organisations—must collaborate to expand coverage to underserved populations by investing in outreach and financial literacy programmes. Improving data collection and tracking mechanisms will enhance decision-making and regulatory effectiveness, ensuring that microinsurance remains a viable and effective financial tool.

Promoting public-private partnerships will be essential in scaling microinsurance initiatives, particularly in climate and health risk insurance, where collaborative efforts can amplify impact. Governments and development organisations are increasingly advocating for public-private programmes to address the risk management needs of vulnerable populations, with a particular focus on health and climate risks​.

Additionally, supporting the responsible scaling of subsidies will help maintain affordability while ensuring long-term sustainability. Data from the report shows that 58% of agriculture microinsurance products receive subsidies, covering 54.5 million people, highlighting the importance of structured and sustainable financial support​. The report also underscores the need for a long-term strategy in subsidy implementation to avoid sudden disruptions that could undermine microinsurance initiatives​.

The microinsurance sector must continue innovating, leveraging technology, and tailoring products to address the evolving risks faced by vulnerable communities, thereby reinforcing financial resilience at a broader scale.

Microinsurance is an essential tool for building financial resilience among vulnerable populations. The 2024 Landscape of Microinsurance underscores the importance of continuous tracking, innovation, and regulatory support to bridge the protection gap. As the sector evolves, leveraging data and market insights will be crucial in ensuring that microinsurance reaches its full potential in safeguarding the livelihoods of millions worldwide. We at MiN are pleased not only to present this new Landscape, but to leverage its findings as part of the European Microfinance Award 2025, which launched on March 12th.

Matthew Genazzini has 15 years of experience in development finance and inclusive insurance and is the Executive Director of the Microinsurance Network. He has a BA in Contemporary History from the University of Sussex and an MA in Latin American Studies from the University of London. He has significant experience in the inclusive finance sector with ADA – Appui au Développement Autonome, managing capacity building and product diversification projects for financial institutions, with a particular focus on microinsurance. In 2017, Matthew managed the Technical Support for MFI’s unit in ADA, which aimed to strengthen financial institutions through the provision of financial and technical assistance services, and in 2020, he changed position and launched the Smallholder Safety Net Up-scaling Programme (SSNUP), a public private development partnership aiming to strengthen the resilience of smallholder farmers by promoting investments in the agricultural sector. In parallel, Matthew joined the board of the Microinsurance Network in 2019 and later, in October 2024, become the director.

Asier Achutegui – With nearly 20 years of experience in development, Asier has worked in evaluating, developing, and designing public policies for social inclusion in Latin America and the Caribbean. He has travelled extensively in search of global development solutions and has been involved in budgeting for projects aimed at improving the quality of life for the most vulnerable segments of the population. Asier has also played a key role in establishing and securing funding for multi-stakeholder institutions and nonprofit organisations. Since 2020, Asier has been a member of the Microinsurance Network Team, where he is responsible for a variety of programmes, including regionalisation, Best Practice Groups (working groups), organising global events, and managing relationships with members.