UNDP Egypt and Milliman Micro Insurance center launch the Insurance and Risk Finance Facility to scale up insurance and disaster risk financing in Egypt
March 28, 2023
Cairo – The United Nations Development Programme (UNDP) in Egypt launched its global flagship project – The Insurance and Risk Finance Facility (IRFF) in Egypt. With funding from the German Government, this joint project, under UNDP’s Sustainable Finance Hub, aims to strengthen the protection of vulnerable communities from socio-economic, climate and health-related disasters by significantly increasing the role of insurance and risk-financing in development.
The facility will contribute to strategy and policymaking and highlight roadmaps to accelerate development in pressing issues such as social, gender, agribusiness, health, and climate insurance.
UNDP, the Financial Regulatory Authority (FRA) and Milliman MicroInsurance Centre launched a diagnostic inception workshop convening partners and primary stakeholders to discuss the issues facing the insurance sector and possible solutions to support inclusive insurance and disaster risk financing. The workshop also presented the roadmap for the actuarial profession, current gaps and potential interventions to help enhance the profession in Egypt.
Insurance and risk financing provide a critical safety net, protecting assets, lives, and livelihoods from the impact of crises. The devastating impacts of COVID-19 have already underscored the fragility of countries and the importance of community resilience.
Economic losses from disasters cost 77 poorest countries an average of US$29 billion annually – with only 3% covered by insurance, forcing many to bear response and reconstruction expenses alone or rely on aid.
"The world faces multiple crises on the front lines of the COVID-19 pandemic, the continuing destruction & degradation of our natural world and a rapidly changing climate. In this uncertain time, insurance and risk financing provide a critical safety net, protecting assets, lives, and livelihoods from the impact of crises", said Alessandro Fracassetti, UNDP Resident Representative in Egypt. "UNDP is proud to partner with Milliman and the Financial Regulatory Authority to build actuarial capacity, develop insurance solutions for vulnerable families & businesses, and help predict and prepare for climate and disaster risks in these uncertain times," stated Fracassetti.
“The world is facing tidal waves of natural disasters and climate change with a heightened demand for risk mitigation of these crisis. Recent events showed the paramount importance of having solid disaster risk insurance. The frequency of natural disasters poses significant challenges to actuaries to quantify these frequencies and risk. This new project aims at tackling the most important factors for disaster relief, quantifying the disaster risk via actuaries and disaster relief for insurance compensations, said Dr. Mohamed Farid, Chairman of the Financial Regulatory Authority in Egypt. “This will be implemented under the new regulatory frameworks to be issued by the financial regulatory authority pending the promulgation of the insurance unified law,” added Dr. Farid.
“Egypt’s global leadership of the COP27 showed the World that Egyptians are ready to make huge advances through action in mitigation, adaptation, and resilience building, to prepare for the compounding challenges coming from climate change. The UNDP’s IRFF coupled with Milliman and the stakeholders in Egypt are working towards a structured and efficient approach at dramatically enhancing the risk management options for low-income people. These activities will boost the actuarial profession in Egypt to enable it to address the coming challenges and underpin the effectiveness of other interventions. The diagnostics of inclusive insurance and disaster risk financing will yield a process to expand the ability of Egyptians to better manage their risk, and for the Government to better prepare financially for potential disasters. All of this is focused on strengthening the resilience of Egypt in the face of coming challenges” said Michael J McCord, Managing Director at the Microinsurance Centre at Milliman (MIC@M).
The IRFF is a flagship initiative of UNDP’s Sustainable Finance Hub and is part of the wider UNDP Global Policy Network. It is the heart of UNDP’s insurance and risk finance support to UNDP country offices, programme countries and partners, providing policy and guidance, tools and methodologies, and networks and partnerships. It acts as a catalyst for the development and delivery of new insurance products, tools, and services, while also investing in the long-term transformation of insurance markets, targeted at boosting country and community resilience to socio economic, health, climate shocks and other crises. To know more about the IRFF please visit https://irff.undp.org/.
UNDP is the leading United Nations organization fighting to end the injustice of poverty, inequality, and climate change. Working with our broad network of experts and partners in 170 countries, we help nations to build integrated, lasting solutions for people and planet.
Learn more at undp.org or follow at @UNDP and in Egypt, follow @undpegypt.
The MicroInsurance Centre at Milliman (MIC@M) is a trusted thought leader and implementer of microinsurance and risk management solutions for low-income populations. We bring world-class capabilities and local expertise to the specialized area of microinsurance and risk management. We have implemented projects in over 75 countries in the last 20 years.
To know more about the MIC@M, please visit https://microinsurancecentre.milliman.com/en.
The Financial Regulatory Authority (FRA) enjoys full independence guaranteed by the Egyptian Constitution to supervise and regulate the non-banking financial markets and instruments including Capital Market, Futures Exchanges, Insurance Activities, Mortgage Finance, Financial Leasing, Factoring, and Securitization. The FRA was established in accordance with Law no. 10 of 2009 and ensures these markets’ stability, the protection of investors, and the transparency and competitiveness of non-banking financial markets.
For more information, please contact:
MIC@M: Michael J. McCord, Managing Director at email@example.com
UNDP: Fatma Elzahraa Yassin, UNDP Communications Analyst at firstname.lastname@example.org
FRA: Mohamed Ayyad, FRA Media Manager at Mohamed.email@example.com
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