IFC-World Bank and AXA partner globally to boost insurance coverage & capacity and improve safety in emerging markets
A unique global partnership to help boost insurance coverage, improve safety and foster economic growth in emerging markets.
Five main areas of cooperation: investing in the insurance industry through co-investments or acquisitions, increasing insurance coverage for women, improving road safety, infrastructure development and responsible investing & access to insurance. Recognizing the crucial role of the insurance sector in enabling and fostering innovation, private sector growth and overall economic development, the International Finance Corporation (IFC) - a member of the World Bank Group and the largest multilateral provider of financing for private enterprise in emerging markets - and AXA have entered into an ongoing global partnership (mainly in Asia, Africa and Latin America). The first of its kind, this partnership aims to boost the ability of the insurance sector to further play its repair, protection and prevention roles in the emerging world through more insurance coverage and capacity, long-term investments and risk awareness-raising. “Insurance is vital for managing risks and helping to promote growth and foster a well-managed economy in developing countries. Partnering with a global insurance leader like AXA will help us catalyze the positive developmental role of insurance, which will ultimately contribute to eradicating poverty and boosting shared prosperity”, said Dimitris Tsitsiragos, IFC Vice President. “There is a significant demand for financial services in emerging countries as people want to achieve security for their families and businesses, and relative to other sub-segments of the financial sector, the insurance industry remains underdeveloped. One of the key pillars of our strategic plan Ambition AXA is the acceleration of our activities in these high-growth markets, and we are very enthusiastic to be working with the IFC to contribute to developing insurance coverage and capacity”, said Denis Duverne, Deputy Chief Executive Officer of the AXA Group. “With growth naturally comes risk, and it is the role of our industry to understand, mitigate and share this risk in order to both better protect society at large as well as foster growth. We are convinced that a public-private partnership of this nature, that brings together such complementary experience and areas of expertise, will strongly contribute to fulfilling this role. We are very proud to partner with such a renowned organization as the IFC”. This partnership reflects the aligned interests of both organizations, and aims to leverage their expertise and leadership in order to improve global access to insurance products, develop insurance capacity and overall better apprehend the risks that accompany progress and growth of any kind. It is composed of 5 key work-streams:<ul> <li><strong>Investments in insurance companies.</strong> AXA and the IFC will jointly invest in local insurance companies with an initial focus on Africa and Latin America. The first project of the kind has been signed with MicroEnsure1, a leading global micro-insurance specialist, in order to help finance its expansion into new territories.</li> <li><strong>Insurance for women.</strong> The female economies of China and India combined will account for $5 trillion annually by 20202. More generally, professional women are posed to significantly fuel the next emerging growth wave. There is as of yet very little gender data with regards to insurance in these markets, but based on experience and anecdotal evidence, AXA and the IFC are both convinced that this is an untapped market in the emerging world, leading to suboptimal insurance penetration rates, and ultimately negatively impacting economic growth and development. AXA is working with the IFC on a market-wide sector study to be published in Q1 2015 with two overriding objectives: 1) to identify the insurance product & service needs of women, as household decision-makers but also as business owners and entrepreneurs, in 10 emerging markets: Brazil, Colombia, Mexico, China, Thailand, Indonesia, India, Morocco, Nigeria and Turkey; 2) to assess the position of women as sales agents in these markets, and explore the business case for strengthening their role.</li> <li><strong>Road safety.</strong> Road accidents are one of the top killers globally, especially amongst the young, but it is also the one that can be reduced the most drastically. It causes ca 1,120,000 annual fatalities - a figure expected to double by 2020, in great part due to growth of motorization and the expansion of highway networks - and with 91% of global fatalities, emerging countries’ populations are the most hardly hit. The IFC and AXA will act on two levers: support governments in their management of road safety (upgraded regulatory frameworks, infrastructure, post-crash responses) and increase public awareness (principally through digital tools). The programs will start in India (the pilot) end 2014, with a possible replication in Mexico, Egypt, Indonesia, Colombia and Nigeria in 2015.</li> <li><strong>Infrastructure development.</strong> AXA’s technical and financial expertise and the IFC’s in-depth experience will be leveraged, with an initial focus on Africa, to build innovative solutions to promote infrastructure, a key driver of economic growth. This will include the development of both insurance and financial solutions.</li> <li><strong>Responsible Investments and access to insurance.</strong> AXA and the IFC will undertake several actions amongst which co-responsible and active investments with environmental, social and governance considerations; initiatives to develop the micro-insurance sector through new product offerings and partnerships with microfinance institutions; research to better understand the needs and risks associated with markets at the base of the economic pyramid.</li></ul> <strong>ABOUT THE AXA GROUP</strong> The AXA Group is a worldwide leader in insurance and asset management, with 157,000 employees serving 102 million clients in 56 countries. In 2013, IFRS revenues amounted to Euro 91.2 billion and IFRS underlying earnings to Euro 4.7 billion. AXA had Euro 1,113 billion in assets under management as of December 31, 2013. The AXA ordinary share is listed on compartment A of Euronext Paris under the ticker symbol CS (ISN FR 0000120628 – Bloomberg: CS FP – Reuters: AXAF.PA). AXA’s American Depository Share is also quoted on the OTC QX platform under the ticker symbol AXAHY. The AXA Group is included in the main international SRI indexes, such as Dow Jones Sustainability Index (DJSI) and FTSE4GOOD. It is a founding member of the UN Environment Programme’s Finance Initiative (UNEP FI) Principles for Sustainable Insurance and a signatory of the UN Principles for Responsible Investment. <strong>ABOUT THE IFC</strong> IFC, a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector. Working with private enterprises in about 100 countries, we use our capital, expertise, and influence to help eliminate extreme poverty and boost shared prosperity. In FY14, we provided more than $22 billion in financing to improve lives in developing countries and tackle the most urgent challenges of development. For more information, visit www.ifc.org