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Alternative Insurance Company (AIC)

About the Project
Project Name: 
Protecta
Type of Facility Project: 
Innovation Grant
Country of Operation: 
Haiti
Region: 
Latin America and the Caribbean
Project Thematic Focus: 
Insitutional models and business processes
Product: 
Life - funeral
Type of Risk Carrier: 
regulated insurance company
Type of Distribution Channel: 
Bank
Microfinance institution
Project Description: 

This project aims at launching a funeral insurance product on a mass scale through microfinance institutions in cooperation with the Banque nationale de crédit (BNC), the third largest retail bank in Haiti and a network of funeral homes chosen by the population. It builds on a recent micro insurance project, in partnership with FONKOZE, the largest MFI operating in Haiti. Over 42,000 people – about 65,000 loans - are currently insured through this program running for only 9 months. The project builds on a comprehensive and thorough market research which reinforces the evidence that, culturally, funeral costs are one of the most important risks faced by low-income households in Haiti. People will have access to the funeral insurance policy of their choice, with no medical exams required. Offering a funeral micro insurance product to the general public will not only reduce vulnerability to risks, but also increase the number of people having access to a financial tool. The innovation grant covers initial investment in new technologies, education, awareness campaigns on cultural and attitude changes leading to better risk management.

Beneficiaries: 

The target population to be reached, in the next 5 years, is approximately 300,000 low-income people.

Lessons from the Project
Learning Agenda: 
  • What is the added value of insurance to manage life/funeral risks in the context of one of the poorest countries in the world?
  • To what extent does exposure to funeral insurance promote proactive financial behaviours and create insurance culture?
  • What is the added value of education campaigns to increase outreach and change attitudes of the target groups?
  • What is the benefit of identification cards for life insurance to increase outreach and efficiency?
  • How effective are popular retail banks and funeral houses as delivery channels?
  • What other products can be added to funeral insurance (education costs, etc.) after successful implementation of the life scheme?
Emerging Lessons: 
  • Constant client feedback is needed to design and improve new products.
  • Simplifying enrolment processes allows the organization to deliver a better experience to clients and delivery channels. 
  • The selection of funeral service provider is important for product development. 
  • Designing messages and testing them with the target audience improves the impact of the promotion campaign. 
  • SMS technology is an effective medium for both promotion as well as communication with clients. 
  • Vehicles with a sales team of mobile agents can provide an additional channel for both distribution and promotion.
  • Certain natural disasters and catastrophic events can be leveraged for building the brand image of a microinsurance product and to provide tangible proof to clients.
  • A regular training program for new sales staff can be a very effective means of tackling constant staff turnover. 
  • Sales force salaries and incentive schemes can be designed and modified to achieve a desired portfolio and retain staff. 
  • The addition of the CIO contributed greatly in the communication with the software developer and in troubleshooting in an efficient and timely manner. 
  • Some technology is too expensive to provide microinsurance at a price that is reasonable for clients. 
  • Improving practice in terms of software selection allows for better implementation of IT systems within the organization.
Learning Journey: 
Learn more about the lessons that AIC is learning in this project.
About the Organization
Relationship with the Facility: 
Innovation grantee
Country of Head Office: 
Haiti
Region : 
Latin America and the Caribbean
Type of institution : 
Insurance industry
Participation in Microinsurance: 
Risk carrier
Organizational Overview: 

Alternative Insurance Company (AIC) is a multi line company offering a broad range of insurance products and services (assets, life, health). AIC started its operations in December 2001 and quickly became one of the leaders in the local insurance industry. AIC introduced micro insurance in 2007, being the first traditional insurer in Haiti to do so, thanks to a partnership with the largest microfinance institution (MFI) in Haiti (FONKOZE).

More about the Organization
Websites: 
Alternative Insurance Company (AIC)
FONKOZE
Quotes: 

"Introducing a financial tool to a market that could not be reached before, managed by trained professionals, will not only improve the lives of populations but will also help extend the insurance market."

O.Barrau, CEO, AIC

"The mere fact of living exposes us to risks that we need to deal with. In the case of developing countries, micro insurance can be considered as one of the best tools to fight poverty."
I. Delpeche, Microinsurance Department Manager, AIC

"Having a prestigious and dignified funeral, put the final note on an honourable departure, and that is the reason why funerals are one of the biggest and most important events a family can encounter in Haiti." 
Client record – Market survey interview

"The clients are absolutely, without exception, thrilled with the program. While we do not have systematic data to demonstrate this, we have lots of examples of clients who have come back to us after dropping out of the program when they heard about the microinsurance, delinquent clients who come to repay so they can get a new loan and be included in the program, etc. We sincerely believe that this program will have a positive impact on our retention rate."
Anne H. Hastings, Director, Fonkoze