Shaun Tarbuck: 

Good morning and good afternoon everybody. Welcome to this webinar. ICMIF and the UNDP have a partnership which was agreed in November last year, and we’re working through the four key parts of that partnership. One of which is very much the focus of today, which is on the microinsurance side, inclusive insurance, but it also very strongly overlinks with the Sustainable Development Goals. 

At that Conference in Auckland, we had a video presentation from the Head of the UNDP, Achim Steiner, and he said, “The ICMIF-UNDP partnership represents a major joint commitment to deliver transformative change where it really matters. Recognizing that the mutual and cooperative sector is essential as they work hand in hand with the communities, building initiatives, products, and outreach directly with those that really need it.” 

 So we have wonderful support from the UNDP and Jan Kellet has been very much behind all of this and our key contact in helping to start to deliver on this transformative change, and certainly a big picture change that we’ve got. So why is it that mutuals and cooperatives are seen as having the ability to deliver on some of these key areas when many other organizations and business models have tried to deliver? 

I think there’s five points and I’d like to make it and these are mentioned in organized joint blog, but the five points are, just in summary, the vulnerability and the informality of our business model. The ability to risk pool has been at the forefront of mutual since all mutual started. They’ve always been there to fill the gaps where other insurers have not been able to. 

Many of our members started, whether it’s 300 years ago or two years ago as informal organizations. And so what we’re trying to do there is try to empower the communities that we have, educate those communities, and then enable them through a mutual structure, which then allows them to engage. So we call those the four Es, and they engage through the governance and they engage through the products definitions. 

Point two is the fact that as an organization we combine our social and our business values together in one business model, and nobody else does that. And that is really helping us to deliver real impact on the ground. Number three is that we are member-owned and serve members only. So we only have one purpose. 

It’s very difficult as all business model and academics will tell you to serve two purposes, which our shareholder model tries to do and for the shareholders as well as customers. We only serve one and that is the customers. Whatever we create, our shared profits goes back into the business. We also have that shared responsibility, so I think that’s very important when it comes to dealing with the communities. 

And lastly, point five is that we have that long-term approach. We can think long-term in all our decisions and initiatives. We can plan long term and build long-term. I think that really does matter. So there are the five key points that I think why mutual delivery of inclusive insurance is different to the way it’s been handled in the past. 

So that’s really a few words of introduction. We are very excited to be in partnership with the UNDP. We do, over the next three years, expect some great delivery, hopefully some wonderful impact as well. And we’ve got a great set of panellists who are actually doing that work in the practitioner format. So I’ll introduce the panellists really quickly. 

We are going to be chaired by Jan Kellet, who has just set up the new Insurance Risk and Financing Division of the UNDP. Newly set up only last year, I think, or maybe even this year because the UNDP does recognize now that development needs to have insurance up the center of some of its initiatives. We have Dr. Aris Alip, who is the Founder and chair of the CARD MRI in the Philippines, which was set up just over 20 years ago now. And he is widely recognized as leading one of the best microinsurance inclusive insurance businesses in the world, not just in the Philippines. Mr. Vasimalai, from The DHAN Foundation, which has done some fantastic work dealing with the poor communities in India. They’re part of the 5-5-5 as is CARD MRI and they have been certainly promoting some great work in the health side for their members in India and you’ll hear more about that soon. And then Graham Clark, who is the CEO of Asia Affinity, who is setting up some new start-ups, has some wonderful ideas in Indonesia, as well as around the Southeast Asia countries. And Graham’s been a real forerunner for the mutual sector and many of the global events in the last two or three years. 

So there’s our panellists. I’m going to keep quiet now and hand over to Jan and have some good discussions. Thank you. 

Jan Kellet: 

Thank you, Shaun. And thank you everyone else for joining today and especially to the panellists and to the introduction. So as Shaun says, we have this partnership between UNDP and ICMIF which is not just ICMIF itself as a Secretariat endorsed by the Board and supported by the ICMIF Foundation, but also it really is about the members. 

What we want to do over the next year and years is actually work through the ICMIF Secretariat down to the members and support your work and see where UNDP can play its role. And as Shaun mentioned, we have – it’s not quite launched yet, Shaun, – the new and first UNDP Insurance and Risk Financing Facility, which is essentially a one-stop shop for all of our country offices, which you’re probably aware were working in all of the developing countries, all 170 countries out there. From the smallest states up to some of the largest growing economies in the world. And it’s the one-stop shop for our country offices and therefore our program countries. So this is their work and our partnership with ICMIF is definitely part of that. 

Let’s move directly into the questions, I think everyone is really aware of in a sense the context, we’re all living in a context now and a shared context and in a way that perhaps has never quite been shared obviously, which is the COVID-19 situation which goes from the global all the way down to the community and the family and everything in between. 

As we all know, as we’re living our lives through various versions of lockdowns and limitations of movements of our livelihoods, of our jobs, of travel, et cetera, socialize, it is having impact far, far beyond health and is going really down into all aspects of society. 

The way we’re thinking about this in UNDP is that it’s really exposing the frailties, the vulnerabilities in everything from the nation state if you like, all the way down to families. And in the richest countries in the world and some of the poorest countries in the world, it’s almost without a universal in the way which we haven’t really seen perhaps before. 

So that’s, if you like, the context and the context for this conversation. Where does the mutual and cooperative community play a role here? And what does that really mean? So that’s what we really want to get to today. So, first of all, I think we want to just focus a little bit on the response side of things. So, as Shaun mentioned, one of the key elements and one of the key things that we do. 

One of the important areas for UNDP is the way in which the mutual cooperative sector is often enmeshed and works very closely with the community, with the members who are in your communities. That’s almost a key part of how we want to engage from UNDP side of things. 

So what I’d like to just ask a few opening questions then to our colleagues as well, what does it mean in terms of your work now with regard to COVID and the response if you like. What does it mean for your work? So maybe we’ll go to Dr. Aris first in the Philippines context and ask you Aris about your work there and what have you done to respond to COVID and how has your work and the model of your work benefited your members? 

Dr Aris Alip: 

Yeah. Thank you, Jan. I’d like to share what the CARD Group has done, especially focusing on the CARD Mutual Benefit Association, our CARD MBA. As soon as our government declared this pandemic and declared these quarantine, middle of March to end of this month of May we have actually declared a moratorium for our clients to not pay their premium. 

So this is the kind of assistance we provided because we know that our clients don’t have the capacity to pay because their business is no longer functioning. So we have to do a moratorium on the premium payment. That’s really a loss for us, but even though we have this moratorium on premium, we continue to pay if there is a claim because this is where we make a big difference. 

We’re paying around five to six million pesos every day, because we have around 169 deaths. We have around 19, thank God we only have 19 that were affected by COVID. So totally for the past two and half months we have already paid around 316 million pesos. Translation, that’s about $6.5 million. 

We continue to pay also our staff because we realized that this is a pandemic, our staff could be on working and servicing. So we’re now utilizing all the digital budgets that are available within our system. Thank God that we have this kind of system, so we’re able to make payments the soonest possible time. 

In fact, our payments now has improved. Within eight hours to 24 hours we’re able to pay because of our internet, because of our… What we call this, mobile phone. So these are the things that we are doing. There is no disruption and because we haven’t value added for our membership, we also come up with an e-Doctor. 

e-Doctor is a health program, where we launched this in the Facebook and every day we have a Facebook TV two hours every day. One hour in the morning, and one hour in the afternoon, and we discuss… Our doctors… Because we have our own doctors and hospitals, and also nurses and pharmacists, they discuss how to prevent or how to address this COVID and other kinds of sickness. 

We also have this pharmacy company that provides the masks, alcohol, because thanks that we have this pharmacy and we’re manufacturing our own alcohol because in the Philippines there is lack of supply of masks and alcohol, but for CARD, because we have our own pharmacy company, we were able to produce all these. Even disinfectant. 

So these are the kind of things that we are doing, and we are continuing to do so. And as of now the government has eased out the quarantine, so there is now sort of mobility. So our clients are really very strong on the credit discipline. So they’re now starting to pay the premium back to the system. Back to you, Jan. 

Jan Kellet: 

Thank you, Aris. I mean, there’s some key points there which we are noting there. The issue about the payment holiday or the premium holiday, if you could say seems to be really key for some of your clients. 

And this provision of extra services, which is beyond insurance, which is the value add, which is seen to be really, really important. And I remember also from the experience of this, that you had also in Cyclone Phyan as well as how that’s affected communities and how these value adds were really important. 

Maybe I then extend this question over to Mr. Vasimalai in India and the work of The DHAN Foundation, which I know is very strong in health, but also other areas with regard to development. And I wonder if you could tell us some of your experiences with regards to how you’re adapting your work with regard to COVID and particularly in the response phase. 

M.P. Vasimalai: 

Thank you. It’s a really unprecedented… Unexpected things in March in India, and immediately all are asked to work from the home. So we immediately got into our strategic team together and discussed, and we usually respond to disasters. We are used to response to cyclones response to flood along with our core focus of development work. Then we came up with the first three months, let us really walk through the coping mechanism. What is really going on in the field and let us respond to them first. 

Then from July, we thought that let us really go for a restoration phase as our adaptation phase. Then at least it will take about a couple of months for us. Then we can really go for a transformative new practice as will emerge from adaptation phase. That’s how we really conceptualize and what we really did it immediately we start up com-call center community call centers. 

We started up in all of our federation, because our mutual structure helps us. We have our groups, primary groups of self-help groups. They are federated. So all are really involved in this whole process. Immediately some of our members, who are tailors, stitched masks and supplied to them. 

Some of our members that are traditional system here, when this kind of a pandemic or kind of infectious things happen, you immediately use turmeric powder and neem leaf water to sanitize your place. Even if really small pox comes in. Immediately, people started practicing those and we really advocated that and demonstrated hand wash practices in many places. How do they really do that? 

Immediately we set this three month rest. Social distancing, mask wearing and there’s the hand wash. These are non-negotiable. So we asked all our members to really go through the practice of it and encouraging them to practice it even inside the house or outside places. This is very important. 

Then immediately we said, “But they don’t have food, and the materials are not reaching their home.” Government was really operationalized during the lockdown period. They were supplying some of the vegetables and other things through vehicles. Then immediately, our federations really started working with the packaging. 

There is a one month package groceries and other things they really took from our membership. And this was allowed in during lockdown period. The lockdown period, the grocery and the essential things are allowed. And our hospitals are also working during lockdown period. So we had a telemedicine structure we have really set it up. 

So the doctors, from their home, from mobile, they can really talk to the doctor and get a counselling kind of processes. So after that second month, we set a virtual telemedicine, we call it a Virtual Wellness Center where in many places we started because we are spread over many places in 14 provinces in India. So each place is different. 

Some are tribal areas, some are urban areas, some of the tribal areas. The problem is more in urban. So in the rural areas and tribal areas, they are really remote places that infection is not much. So we were really trying to do this. Most of our work is basically working with government. So all our federation immediately tapped the entitlement processes, which is offered by government. 

They offered a cash transfer for each individual account, and they also offered a cash transfer plus rations. The food items were being supplied. So we made them to really access those. Farmers and everyone to the tune of last two months, nearly $5 million has been accessed by our members of the government entitlement. 

These are immediate responses. Plus we also started… Government has unlocked for agriculture activities and for employment generation from 20th May. Then we really facilitated people to really enrol in employment work. Plus they were asked to really work on the kind of survival support. Their survival support is very, very important. 

Some of our people in mutual immediately created a revolving fund, no interest. They responded to the members survival support so that they can pay after six months without interest. This comes from our reserve fund of our people mutual. So many of our federation all saw the reserve fund response to this for the survival support. 

Then the livelihood renewal started only just recently where the bankers came in a big way. Nationalized banks came in a big way. A special product has been designed by bankers for COVID. So additional loan. Our self-help group has a direct linkage with a group of banks. So they were able to really mobilize funds for their partly survival, partly for renewing their activities. That’s also happened and it’s happening now. 

Now, it’s going to be a real… Big challenge was with the migrants. The people are returning from their home religious. There, there is no work. So there, they need a survival support, which also we started a common kitchen, community kitchen there to supply food and other things by the federation itself, not done by that, that each Federation has created. 

Mutuality has helped us very much because our strong point is the nested mutuality, the groups federation helping each other. The help from our side is also taken, helping from each other was phenomenal. We could be able to see the kind of responses and we were not affected in terms of the insurance and the risk management and the digitization. We are just pushed to the digitization world. We ought to really only work through digitization for everyone. We talk to the leaders, talk to the members, so we cut across our own staff on the other thing. The reality was very good. So nearly more than 50 online training programs, workshops simultaneously going on health and also on the Farmer Producer Organization and other things. 

I think it was really very vibrant work during this period. And we expect a lot of challenges in coming years. And we really look forward as a new way of working in coming years. 

Jan Kellet: 

Thank you, Mr. Vasimilai. It sounds very comprehensive and there’s a lot to pick out there. I mean, one of the things which are really relevant to me, or really, if you like, focus my attention, one is the business model itself, the way you have the Federation and the various groups and how there’s a lot of spontaneity to an extent during the response. It’s almost like it didn’t need you and it didn’t need others. 

It came partly through leadership and partly through the groups themselves realizing, “We need to help our communities through the provision of resources, production of various goods, providing information on health, hand-washing, etc” And then these other ancillary services that we talked about, telemedicine and training. 

Maybe there’s one which you mentioned which I thought was really interesting about how you facilitate the access to government services, which perhaps would have been more challenging for your members if they didn’t have you to sort of help them through that. I think that’s also really key as well. So thank you for that. 

So now, moving over to Graham. Graham, I know you’re working in a lot of different areas where insurance is one part of a sort of multi-package of support products, tools, and services to your members. And I wonder if you could tell us about some of your work and particularly in the sort of COVID response phase. 

Graham Clark: 

Thank you, Jan. And thanks for inviting me to participate in this panel. I think that we’re a small company, but we’re operating in three very different territories. We’re in Japan, we’re in Malaysia and we’re in Indonesia. And we are in the middle of a fascinating journey in terms of how the three countries and the communities in which we’re engaged have reacted and indeed are changing in each of those three countries. 

I kind of look at this internally and externally. Internally, our first priority obviously was to help people. We haven’t got a lot of people. We’ve got 40 people spread short over the three territories, but the real thing for our priority, first of all, was obviously to our colleagues and their families. 

So putting the company effectively onto a war footing from day one. From two things, A, from health, being able to let people work from home and work flexi. Some territories have locked down, some have no lockdown. So we were able to navigate through that. 

But I think most important is to be able to say to all our people, their jobs are secure. And by putting the company financially on a war footing, that those jobs will stay secure. We’re assuming this is going to last for 12 months before we see any meaningful change. 

In terms of the community, we were quite fortunate in Japan initially when COVID began to ramp up that the supplies for medical equipment and particularly of mask and of sanitizer were readily available in Japan. That was no longer the case after a month, but we were able to support some of our field officers in Indonesia, particularly with masks and with medical equipment, which just wasn’t possible to get locally. 

The one initiative that we’ve launched in Indonesia in relation to COVID, which I think is we see as a unique opportunity is actually launching questionnaires in terms of community response across 2000 credit unions. Now we see the credit union as being the closest financial community to the grassroots consumer. So what we’re asking with this is to get feedback now in terms of exactly what the issues are way beyond liquidity. 

We’re not asking them how much cash they need. We’re asking what are the issues that they face with their businesses, and more important that their consumers face. So what we’re hoping from this is that the responses are sufficiently detailed, that we can begin to prepare and launch engagement strategies that go way beyond the concept of providing insurance products that cover health and actually really address community need. 

Because I think in this whole COVID pandemic that we’re going through and all changes that are coming out of it, and these changes are significant. This is way beyond the health and livelihood. There’re new models coming out of here, there’re new businesses that are going to emerge. So this is a unique opportunity, I think, to think about how we, and indeed all our businesses in the mutual and cooperative space can actually play a more significant and meaningful role in the future. 

Jan Kellet: 

Thank you very much, Graham. That’s really interesting that you’re saying you’re in a sense already shifting beyond what’s happening right now and thinking, “How do we actually enhance the role of different mutuals and cooperatives and the business model that we’re talking about here,” and saying that it could and should be more influential in the countries in which we’re working. 

So that’s very well taken. I guess this is one of those advantages for those mutual and cooperatives that work in one country compared to other country, or regionally beyond one country have the ability to maybe mix and match resources from one place to another, where that is often well. 

And I imagine there’s more mutuals and cooperatives in different places that are able to do that. Actually this leads us very nicely onto the second question. I actually got to bundle the second or third question that I sent to the panellists into one, which was one hand there was just looking at, well, the issue of complexity in the sense that has the pandemic risk, if you like, made your work much more complex when you’re looking at the mutual and cooperative model. 

But what I want to do is to build on that sort of analysis and talk about the future as Graham was talking about. So, if you like, given that we have had this almost unprecedented event, we’re living this current unprecedented event, what does this mean for your work, your mutual and cooperative business, the products that you provide for your customers, your members, and the tools and services that you also provide? 

What is the major sort of lessons you really have learned from this and how do you see the future and the future of your industry and particularly of your company? So maybe again we go with the same order. So here we’ll go to Aris for you. What does this look like for you now and into the future? 

Dr Aris Alip: 

Thank you, Jan. It’s really more of the concern of what we call and I call re-imagining. We now have to re-imagine, re-think the way we do things. And CARD group is now re-imagining and re-thinking the way we do things. In fact, we’re starting it now, and it was good that we had started long before, because we’ve now pushed our products and services, including our organization to really re-imagine things. 

To give you an example. In re-imagining our organizational setup, there is this brick and mortar that the CARD group, including our microfinance, we have over 3,800 branches Countrywide, and we have about 20,000 full time staff because of our microfinance and micro-insurance. Totally, we have 7 million family clients, and our total insured is about 26 million. 

This is about 26% of the entire population in the country. Now we are re-imagining it cannot be the usual thing. It’s not the normal. And as Graham said, this will not be over within 12 months. Some say it’ll be two years before we get the vaccine, at the earliest it will be next year. But because Philippines belong to an emerging market, it will take us two years before we get, because we were told that first world countries have already their orders. 

So anyway, in our re-imagining of our organization, we will not have any more of this brick and mortar. Slowly we are going to phase it out definitely because we’re worried about health. We’re worried about… We need to ensure the social distancing. So we will just have a scalable group and we will convert our staff to more technology savvy. 

So in our business, we’re now re-imagining that there will be more working from home. Now, most of our people are working from home and it can be done. And the question that I had to myself is that it needs a pandemic before we rethink about these ideas. And I saw a lot of savings. 

We save a lot of costs and our staff also save a lot of costs because there’s no more entertainment, they don’t have to go to the restaurant. Not that I don’t encourage it, but this is the way things are. So we are now working on our organizational system. So most will be working and staying in home, and how do we now monitor on their productivity? So we’re looking at the productivity and monitoring on their accomplishment. So how do we now make sure that this is managed? 

The second one is when you talk about products and services. We will also have to reimagine this as we are now doing this, the methods, since there will be less brick and mortar. For example, the renewal of our non-life micro-insurance products like the disaster insurance, the health insurance. And mind you, COVID-19 is part of our health insurance. So if you get hospitalized, you’re covered under our health insurance, because COVID-19 is part of it. 

Now, how do we make sure that the delivery is no longer face to face? So we now have developed our own system and we’re now actually perfecting it. So our clients are now actually renewing through our cell phone digital. We call this… We have launched this earlier on, so in just minutes or seconds, you are already renewed. 

And then, if there are claims, how do we make sure that without visiting physically, you can make the payments within eight hours or very few hours. So we are still using our CARD leaders, the volunteers in the community, because they’re still there. So all they need to do is put it in a messenger, have it pictured, and this is validated and it is sent to us. 

This has now worked on, and there are some control mechanism and payments can be made as soon as possible. So this is the time of re-imagining this will be the state of the things that we’re doing now, and we’re seeing it’s very effective. We’re seeing it’s quite… Although our clients are still learning how to do this budget, but I think this is also part of the training program that we’re doing. 

So part of the process and the methodology is teaching our clients. Remember our clients are not the middle class. Our clients are the mass base. These are the vulnerable and hard to reach area. So we’re also now putting in internet cafe shop. We’re now working on that, and this is also where our clients can go. There’ll be some subsidies and we’re now making arrangement with the tele providers that we can get some concession because there are other business that we can still give. 

So these are the things that we’re doing, including our microfinance program. It’s no longer face to face. They can take loan using our budget, using our agents. So there is no more… Lesser or lesser social contact to avoid this pandemic. 

So this will be the future. This is now… The writings are on the wall. So we are going to pursue this digital formation, digital transformation and things like that. Thank you. 

Jan Kellet: 

Thank you, Aris. I mean, that’s really interesting. I mean I’ll take your point that it didn’t need a pandemic for us to realize that we could do things differently and perhaps better or perhaps cheaper. I think that’s a relevant point. From a UNDP perspective, I can also think about this. 

As you’re aware we have this new quite large program where we’re going to be working in 20 countries over the next five years. And it’s both on the products and services side of things, but also on the legislation and regulation with partners like yourselves, with governments and so on. 

Dr Aris Alip: 

Yeah. That’s faith in approach, not to be afraid. So we have this strategy of defence and offense. We see the pandemic as being an opportunity for us to re-imagine a lot of things. And we see that there will be a more efficient and there will be also cost-efficient, were we are able to lessen our costs. 

We don’t have any more to rent our physical facility, no more rents, buildings. So these little things. We will still lower… And because of this, we’re able to lower the cost. We can still pass on a lower premium to our clients. So this is good. 

So our strategy, defend and make an offense. Defence and offense like basketball. Otherwise, I see many of the mutuals, they’re only defending. They should make an offense now, because if they don’t move now they lose their competitive advantage. 

Jan Kellet: 

That’s a good point. Thank you for that, Aris. So, Mr. Vasimalai, the experience of The DHAN Foundation in India, I mean, how is this changing your work both in terms of maybe the way you’re working, but actually the kinds of services, tools, products that you and your members are looking for? 

M.P. Vasimalai: 

Our core business is enabling. We are enabling and probably contrast to what CARD is doing. We are really an enabler and our core business is poverty eradication and nutritious healthy family and democratic people in tradition. These are our three core business. 

In this core business we also have our credo. It says savings first, credit next, insurance is a must, pension is the best for the aged people. This is our credo for all our people in institutions. Here, we are building a federation, self-sustainable federation, which now we are getting into our business for future. 

On the health side, we got a sustainable behavioural change communication material well done so that COVID… Kind of why COVID? What COVID? How do we really look at the COVID and address it with our immunity food system? So we have come out with a dual flip charts in [ASA SBC 00:38:32], sustainable behavioural change material. 

Well, our health also has to go hand in hand. In our poverty, 15 to 20% of the people below poverty fall into poverty because of health reason. Unless our health products are very strong and it really responds to this kind of emergencies, our insurance, if it’s not responding, they will really go into the poverty very deeply into that. So we are now promoting our… Already promoted about 119 mutual federation. 

Our basic unit is a federation which offers different products, not only life, health and our products are going to be livestock insurance, which we are really going to introduce into that. And crop insurance is also not only mutual, it also hybrid with the government mutual system so that you use a common mutual system as a reinsurance system. You go for a mutual, and that kind of a hybrid also we are really working it out. 

And basically our growth perspective is a self-growth. Each of our present 100 mutual is going to promote another 100 mutual in north India, the new location, new area, which means that community financing is going to develop pretty more. So the surplus or the kind of reserve fund reach out, they will really support to set it upon their Mutual Federation in North India. Himachal Pradesh or other provinces. 

That is our self-growth strategy with a community financing. And we are also looking for kind of entering into the diversification of our products. Not only life, we are also planning to go for endowment life. So that would really also provide a scope. 

In fact, because of COVID, we are not that much affected because the whole mutuality system is so strong, and this is a temporary phenomenon of three to four months now, probably it can extend up to one year, but there is a strong base of their surplus and their funds, which is again, they have principal of no subsidy involved in this. 

They always go with the cut cost, all place, cost place for themselves. It is not going to outside the system. The whole surplus is used again and again for their one growth and also to offer some more services. 

So we think this concept of our mutuality getting stronger in future years and also this digitization is also making or opening forward to reach to the members very strongly and educating them and properly they understand that. And also we can also extend our work to other self-help network. So there is a huge self-help network in India. So we are committed to reach a million kind of families. 

We will do that in next year itself. I think we don’t find that as difficult to target for us. And we may also reach a network of mutuality to support and share our experiences and share our knowledge to that. So we look for a different kind of working not only with the members and also other network members also. Thank you. 

Jan Kellet: 

Thank you very much, Mr Vasimalai. I mean, there’s a lot there what you were talking about. I mean, of course there’s a key point here, which I just… It’s very relevant. You mentioned the statistic of, I think you said 20% of people falling into poverty due to out-of-pocket health payments, which of course is massive, and the statistics I believe for this worldwide is 100 million people that fall into poverty because of an inability to pay for health coverage of various kinds. And that actually largely is still in developing countries. 

I noticed a number of things here. You’ve talked… I think if I dare to summarize some of the things you talked about here, I think that you’re saying in a sense that COVID in a sense has almost made the mutual co-op model and your work more relevant. Even more relevant than it was before, perhaps. 

And perhaps, because particularly of the way it works, that it is with members, that it is based in part upon the spontaneity of your parts, of the work and the Federation. And also I noticed you also touched upon the digital as well and the need to expand your work. So that is all very well taken. 

So maybe I’m moving out to Graham on this question, and Graham what does COVID-19, if you like teach you and for your work and as you go forward? Is it more complex? Are you changing the way you’re working? Are you changing the kinds of products, services that you offer to your members? What does that look like for you in Asia Affinity? 

Graham Clark: 

This is probably the subject of a two hour session rather than a one hour session. But I think as I said earlier, this is a massive change point for all of us. And I think that across the features where we’re operating, the impact’s been very different. The single largest impact is digitalization and a move towards it. 

By that I mean, not just in terms of communication of virtual meetings or promoting a business, but the realization that with digitalization comes a change in the whole way you can communicate and offer services and the types of services that you offer. That goes right the way through from communications through to digital health. 

The impact has been in terms of the digitization piece perversely. The biggest impact has been here in Japan in terms of change of attitude, because things have had to change and it hasn’t been an option. So we’ve been able to see changes here in our business models in a way I could not have done in five years in under any other circumstances. 

If we move down to Malaysia, the biggest single issue there, the impact, has been because of lockdown is the trauma and mental health aspects, people living in crowded conditions, and in terms of how we balance that out, both within the companies and amongst the communities. 

Indonesia has been a different set. Massive issues working within our two core segments there of consumer interface, the student sector and hospitals. So the hospitals, the private hospitals, the cooperative hospital with whom we work have really struggled. No support from government, no support from external sources. So they really struggled. The universities are an immense worry. 

Some of the cooperative universities we work with have got enrolments for the next semester that have been down 90%, that’s because they’re just… Parents haven’t got students. All these impacts go right the way through. 

The biggest negative of COVID that we’ve found so far has been on the impact of implementing digital change, where, as you know, we’re waiting to launch a pilot for blockchain technology in Indonesia. Now, we just can’t do it. It’s not… Unless you can see people face-to-face, then it’s very difficult to implement these kinds of changes. So that’s been a big negative. 

Combining your questions two and three and looking for the future, I think there are two or three very, very big issues here and big opportunities that as within the cooperative mutual sector we can look at. I think the first and this is Mr. Vasimalai touched on this, is the need to develop alternative community models. 

I think a lot of the micro space has been working on fixed-based insurance products that have been dumbed down for the outer community distribution. I think there’s a new model here, and I think it’s integrating with government. I think it’s integrating with self-help, generating new mutual kind of concepts and also with the commercial market. 

So I think there’re hybrid models that we can develop here, and I think we can use COVID as a catalyst for that kind of change. I think a big lesson that we’ve learned in this globally and perhaps more so in the developed economies, less than the developing, is the lack of alignment between government, commercial banking institutions and the consumer. 

This, I think represents an enormous opportunity for normal banking for consumer finance and the MFI sector as a whole, because the trust element there is completely different now, and it’s very much more different now than the consumer involvement with the commercial banks. 

The commercial banks have not stepped up to support need in this pandemic situation. So I think that’ll create more models. I worry and I agree with Aris. I worry about the recovery period on this. And I think there are certain sectors on this that’ll really struggle. 

This anecdotal evidence was a webinar I was listening to last week, which had on it quite a famous restaurateur in New York. And he was referring back to his restaurant at 9/11 and he says, “9/11 happened. We closed for five days, but it took me three years to get the same number of customers coming into my restaurant as I had before 9/11.” 

So I think there’ll be a delay in this hospitality and the restaurant business right the way through. If you look at certain segments like the cruising industry, they’re talking now about it taking four to five years to get that industry back to the level it was post-COVID. 

Now, this potentially for the Philippines is a major issue. When you think how many of the hospitality crew for the world shipping on the world’s cruise lines actually come from Philippines. So this goes right the way through. I think you’ve got also in here digital accelerates and digital is a great accelerator. But you also have a vulnerability. 

There are digital companies out there that focus their core businesses on travel and hospitality that found in the months of February and March their revenue dropped by 95%. A lot of them are no longer in business. So I think with digital change comes a need to understand digital awareness in terms of the new kinds of commercial risks that you’re open to as you go through this period of change. 

So I think on balance is some great opportunity. I think that the handling of catastrophe loss, if I may put it that way, this pandemic, the one thing that’s very, very clear is this is a community solution, not an individual solution. It has to be driven at a community level and we have to respond to it collectively. 

Jan Kellet: 

Thank you, Graham. Well, that’s all very much well taken. I mean, again, difficult to pick out too many things from my side. I guess one hand you talked about for example, okay, of course not just the impacts in terms of your business and your work and providing to members and so forth, but the massive impact actually on the businesses that you’re supporting which is from whatever sector that might be, and let’s be honest, it’s been almost every sector that has been impacted in one way or the other. 

So that’s obviously a key part of your thinking of the future. And then you’re talking about the benefits of technology, if you like. So, okay, a push towards digitalization, which wouldn’t perhaps be there before, but I see some limitations when you’re looking at blockchain and setting up these new ways of working. 

So innovation technology is great, but also has its limitations within the current social distancing model, perhaps you could say. Your focus on both the commercial opportunities and commercial risks within digital markets and I guess relevance also for the mutual and cooperative sector. And maybe it’s the final point, which I thought was interesting is this may be presenting to us the opportunity to think things differently when it comes to the way in which we work in micro-insurance or related things. 

This surely does provide us with an opportunity. It’s forcing us to do so. Just as a note from the UNDP side of things, and this comes directly from Achim Steiner, our Administrator. He was requesting that we draft an initiative to look at providing micro-inclusive insurance to the entirety of Africa that doesn’t have it, which is more than 8.6 million people, according to WHO. 

There’s a customer of about $15 billion a year if it’s sort of micro-health insurance. There’s also the possibility for us to look at things at scale and scope, which we’ve never done before using the opportunity from COVID. So with the different business models, absolutely, but different scale and scope, why do we exist for example, and continue with that levels of vulnerability in some of the regions of the world unaddressed, because of our inability to think differently. 

Anyway, that’s just where we are there. Now, we have a final question, which I’m actually going to give to Shaun as a kind of wrap up to the whole session, but actually there were some comments from people online focused on prevention, which came in not just on I guess, the risk financing angle. 

And I think some of the work from within the mutual and cooperatives definitely is about prevention as well. We don’t really have time to look at this in detail, but I do want to focus on this question which came in about the infrastructure for digital. Okay. We want to go into digital, but what about the issue of mobile phones? 

What about the issue about electricity in some places of the world to be able to power your phones. What does that mean for the mutual and cooperative market? Maybe we can reverse the order here. We can go Graham and then Aris and then Mr. Vasimalai. What about the infrastructure to be able to do this whole new model of working. 

Graham Clark: 

It’s a very key question, and it’s particularly key if we use the STG of leaving no one behind, because in digital engagement leaving no one behind there’re age issues there and there’re segment issues there. Bandwidth is a big issue. Particularly I think for us in the Philippines and for us in Indonesia, and certain in the urban areas is absolutely fine. 

But I think the bottom line on this is that we need to look to the future in the same way as we’re looking for climates at 2030 and population at 2050. We need to build our business models on the assumptions that the bandwidth is going to get there. So we can’t wait for it to get there, and then change our business models. 

We have to be able to attack those segments where the need is now. And particularly, as we move into mobile health, digital health, and telehealth, tele support, those things are available. Even if you’re… You can even use some models that work on analogue phones or analogue mobile. 

So I think you must work on the assumption that we’re leaving no one behind and that bandwidth will be there, otherwise you can’t play catch up. You’ve got to bring the people behind you. 

Jan Kellet: 

Very well taken. Aris, what are your thoughts on this issue about the infrastructure that we need for us to push forward with the digital model? 

Dr Aris Alip: 

I’d like to add CARD is a group of companies. We have about 23 companies and a number of them are support system. One of our companies, the [BDS 00:54:44], is in charge of promoting solar power. So the ability to access over 7,100 islands, and some of the islands have no power. 

Some of the hard-to-reach areas have no power. So we’re now providing and selling at very reasonable costs on the solar panel. This can be used as a substitute for electricity. And somebody asked me also in the forum just now, what about the cell phones? We’re opening also cell phones loans at a very low cost, and they can use this solar energy, the solar battery to power the cell phone. 

So these are the things that we’re doing, and this is time to ensure that everybody is… No one is left behind as Graham said. So these are the things that we’re doing. We are making sure that there is energy, electricity, solar power as a substitute. And we provide cell phones loans at a very low costs so that when we are now in full digitalization, then our clients will have cell phone and they can use it. Thank you. 

Jan Kellet: 

Thank you, Aris. Mr. Vasimalai, what are your thoughts here on, if you like, how to increase the role of digital in your work and then maybe the issues of infrastructure, which is behind that? 

M.P. Vasimalai: 

Yeah. I think three points I would like to share here. The community infrastructure that is where the 5-5-5 program of ICMIF is helping us. The 5-5-5 is five countries, 5 million households, five kind of programs there. So this 5-5-5 help us in the community infrastructure, which means they’re providing a promotional cost kind of infrastructure. 

The second infrastructure that is needed during this COVID is the digital infrastructure. The digital infrastructure includes the kind of android mobiles, as well as kind of solar power and also data analytics support structure, the data warehousing. I think that is going to be a new kind of additional infrastructure. 

These two are really critical for our future growth. And for that, I would say that both ICMIF and UNDP have joined hands for these webinars. They can also join hands for probably 10-10-10 or 15-15-15. So probably we can talk about 10 countries, 10 million for community infrastructure, as well as community reaching more members in African countries. In fact, DHAN is interested in sharing our knowledge even to enter into Africa. Thank you. 

Jan Kellet: 

Thank you, Mr Vasimalai. I mean I certainly do think that certainly from our side that we are going to be increasingly focused on the role of digital. I think it is being forced upon us, even as we build our own insurance design and stability. We might not have thought about it so much before, but it actually is been presented to us as something that we have to do, not that is it a choice for us to do. 

So that’s just a note. And then maybe just before handing over to Shaun, there was many good things but Graham at the same time, I’m understanding you well, and so it’s almost like the infrastructure will catch up with us in a sense. One way or the other, we have to move forward. And by providing the right tools, services, and so forth, then the demand for that infrastructure will grow and then it will catch up, I guess. And I guess that’s one thing for us to consider. 

Now, what I want to do is just sort of close off the invite by handing it back to Shaun. There was a sort of final question. Maybe you can put this into your wrap up, Shaun, this question which was what could we, in the development multilateral sector, that’s us in the UN side of things, do more to have to work with you with the mutual and cooperative sector? 

That’s in light of COVID with a more complex basket of risks that we’re all managing and the relevant development. What could we do? And maybe then you could just segue then to close using that as your close as well. 

Shaun Tarbuck: 

Yeah. Thanks to the panellists, some really interesting thoughts there. I’m going to start with a challenge and then maybe a potential solution that ICMIF and UNDP can work on. The first challenge is that hopefully you know that the mutual market share globally of the insurance sector is 27%. But what you might not know is that that is split between the developed countries and the emerging countries. 

Now, the developed countries, it’s 33% and growing, and the developing countries it’s only 4% and decreasing. So we’ve got a gap there. You could call it an inequality in the mutual sector if you want. So there’s plenty of inequalities that have been created through COVID, through the health side and the wealth side. 

We’re seeing these coming to the fore a lot more now, but I do think if we can solve the inequality in the mutual sector by increasing the market share in the developing world from that 4%, and maybe we target up to 10% in 10 years’ time, then that will start to close the inequalities that we’re seeing. So if you go back to why mutual market share is so high in countries like France, Japan, Germany, US, Sweden, Finland, it’s all over 40%. 

It’s all high because historically mutuals have stepped up to fill the need which was not being met by the commercial world. We’re not seeing that being allowed to grow in the emerging countries except in certain areas. And I know Aris is very humbled by what he has done and the other Philippine mutuals as well are doing in the Philippines, where the market share of the mutual sector amongst the poorer community, correct me if I’m wrong, but it’s somewhere around 75, 80%. 

Most of the microinsurance is delivered in the Philippines by a mutual, and CARD MBA has gone from nothing 20 years ago to 26 million people. 26% of the country covered already. Now, from the health side, if I also look at other solutions, there are many health mutuals around the world, but there are also a lot of second tier ones that are working exceptionally well. 

So if you go to Australia, France, Netherlands, you’ll see a real strong second tier of healthcare that’s provided and that’s nearly all by mutuals. Not solely, but nearly all. So there are solutions out there that can allow us to get to scale on the health side, but also solutions that are allowing us to get to scale on the insurance side. 

And I think it’s this whole balance, because I know a lot of the UN and everyone else is driven by, well, what’s the numbers and what’s the scale. But I do think it’s not just about the scale, it’s about the impact and it’s how we measure the success against the sustainable development goals, which is why it’s really important to look long term into these projects and not just suddenly get, “Oh yes, we’ve got another million there in a week.” 

That doesn’t work. That’s not long term. That doesn’t educate. That doesn’t build resilient communities. So here’s the challenge that I think we can possibly take. We know where the success stories are. We’ve got them with CARD MBA. We’ve got with The DHAN Foundation. These have grown phenomenally well by themselves. Okay. 

Both are in the 5-5-5, and maybe there’s a little bit of help from the global mutual community, but by and large, it’s the leaders that we’re looking at here that are actually growing those businesses. Just in Southeast Asia, excluding the Philippines, we’ve got 550 million population. 

If we were to take the CARD MBA model into those 10 or 12 countries in Southeast Asia and get 26% market share, not in 20 years as our system, but maybe do it in 10 years, then you’re going to get about 125 million more people who are covered for what we would term resilience insurance. If you went to South Asia, so Sri Lanka, Bangladesh, India, Pakistan, you’ve got 1.8 billion population there. 

If we get 20% of that market, which has access to resilience insurance, that’s going to be another 360 million. You’re already up to nearly half a billion. So maybe that’s the big audacious goal that the UNDP and ICMIF can take forward is that there is half a billion people there that we could get to and provide resilience insurance through healthcare, through SME business, through just general insurance to help them protect their assets and protect their lives and protect their families over the next 10 years. 

So maybe that’s the goal that we can start to think about as the UN. It’s cut to scale. We know what works. We’ve got best practices. It’s pulling it together and having the why and wherefore that they ICMIF and UNDP can come together and help try and deliver this. But I know that’s audacious but we’ve got to set some big targets. 

And like you said, in the African model, there’s some big target there as well, but that’s just some ideas to put out there. We know how we can get there. We just need the political will, I believe, to help us get there. 

Jan Kellet: 

Okay. Thank you, Shaun. I mean, maybe there’s a target there which we can even use to frame our own partnership, which is that 10% that you mentioned. 10% of markets being from mutuals and cooperatives in all the countries in which we work. I mean, that would be an interesting one, right there and significant to us in some places of the world. 

Anyway, thank you very much from my side. I’d like to say thank you to the panelists and thank you for your time and thank you to everybody online. And I think Shaun, this is maybe going to be the start of a series over the next six to 12 months. 

So we’d maybe pick thematically on a range of issues relevant to the mutual and cooperatives, just thinking about that on the top of my head, but it sounds to me there could be some relevance, whether it’s health, SMEs, business continuity and other issues, but I think this is something worth exploring further. 

Shaun Tarbuck: 

Thank you, Jan. Yes. We may be having some targets there. Thank you everyone for coming online and being part of a great panel. 

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