Mutual insurance: Resilience for an unknown future

We speak to Shaun Tarbuck, CEO of global sector body ICMIF, about the co-op insurance model and sustainability

Insurance by its very definition is a person, organisation or idea thinking about and providing protection against a possible eventuality – providing resilience against an unknown future. For co-operative and mutual insurers, people are at the centre of this thinking. And the International Cooperative and Mutual Insurance Federation (ICMIF) brings these organisations together. 

ICMIF connects values-based insurers from around the world to help them strengthen their organisations in a non-competitive environment – supporting people and encouraging organisational capabilities. It is the voice of the sector wherever it is most needed.

“We’re long term thinkers. We have a stakeholder engagement and a purpose-driven model,” says Shaun Tarbuck, ICMIF CEO. Part of this long-term thinking for him is the need to engage with the UN’s Sustainable Development Goals (SDGs) to create a resilient future.

The SDGs are “the biggest gift co-operatives have been given in 100 years”, he says. 

“If you went through each of the SDGs, they are focused primarily on resiliency. The word ‘resilience’ sits underneath all of them.”

He highlights how the UN’s Sendai Framework – a set of common standards, targets and instruments for disaster risk reduction which acts as “the ultimate agreement from the UN on resiliency” – also sits across the SDGs. 

“Everyone should recognise themselves in the SDGs, but you don’t have to pick out all of them – you can just pick the ones that you think you can do,” says Mr Tarbuck. 

In 2018, ICMIF had 11 members (out of 150 insurers) who were reporting against the SDGs. By the end of 2020, that number was closer to 30. “Mutuals are running way ahead of the rest of the insurance industry in terms of embedding the SDGs properly. Our members are collectively reporting back on all 17 SDGs. Two of our members are reporting on 13, another is reporting on three; it’s all down to individual companies as to how they can make the impact, and how well. A lot of the time, that goes through the board.

“For insurers, you have also got to break it down into the liability and the asset side – on the asset side, I’d point to the Net Zero Alliance initiative, which looks at how pension funds and insurance companies utilise their assets in a way that is best for ecosystems, societies, and economies, including investing in climate-resilience. ICMIF member Folksam Group in Sweden was a founding member of that. The SDGs bring it all together.”

But Mr Tarbuck believes the SDGs are something that every co-op and mutual should be doing, not just those in insurance. He says shareholder businesses are discussing “stakeholder capitalism” which takes into account workers, suppliers and communities. “That is basically about embedding the SDGs,” he argues, “ and they are far better at PR than we are. We need to encourage every co-op to be doing this.”

ICMIF is developing an SDG calculator for launch this year, which is being supported by the UN PRI  (a UN-supported network of investors working to promote sustainable investment) and Swiss Re (which is doing the technical creation). It is also working with three of its members to make sure the calculator reflects mutual values before it becomes the standard benchmark for the industry. 

And the federation has joined the World Benchmarking Alliance (WBA) as an advisory association. The WBA represents organisations working at global, regional and local levels to shape the private sector’s contributions to achieving the SDGs.

The WBA was set up after Aviva, Index Initiative, the UN Foundation and the Business and Sustainable Development Commission were brought together by a common belief that the private sector can strongly contribute to, as well as benefit from, the global ambition of the SDGs and that corporate performance benchmarks are powerful levers for change. 

“We’re doing it because it’s the right thing to do,” he adds. “It’s showing leadership in our industry.”

This leadership can be seen across ICMIF’s members, who are working to build resilient communities around the world – particularly as the effects of Covid-19 continue.

In the Philippines, for example, programmes to develop microinsurance have become an increasingly important lifeline for Filipinos during the pandemic – particularly those with low income and limited access to mainstream insurance services. 

Here, ICMIF member The Microinsurance MBA Association of the Philippines (MiMAP), also known as RIMANSI, has recently highlighted how microinsurance has grown from coverage of less than three million low-income Filipinos in 2007, to 40 million people in 2019. Much of this gain can be attributed to the efforts of microinsurance mutual benefit associations (Mi-MBAs) across the country. 

However, millions of low-income Filipinos are still uninsured and remain vulnerable. MiMAP, together with its 18 Mi-MBA members, has taken on the challenge of reaching out to Filipinos and has committed to greater financial inclusion with a target coverage of 48 million poor and low-income Filipinos by 2024. It is being supported by Citi Foundation, which works to promote economic progress and improve the lives of people in low-income communities, through a grant programme to help members adopt broader technology and increase the awareness and appreciation
of microinsurance.

In Italy, Unipol has led a project to help farmers adapt to climate change and increase the resilience of the Italian agricultural sector, and in the UK, Royal London launched new social impact commitments to make a positive difference for customers and communities.

And last May The Co-operators (insurance and financial services in Canada) announced CA$200,000 in funding to support Canadians who are most vulnerable and impacted by pandemic. And in November, launched Pathways to Employability (P2E), a CA$2m Co-operators Community Funds initiative dedicated to supporting the employability of marginalised Canadian youth who have lost jobs or educational opportunities due to Covid-19 shutdowns.

“Marginalised youth have been especially hard hit and some face additional challenges to employability that make them particularly vulnerable to these unprecedented unemployment levels,” says Rob Wesseling, president and CEO, The Co-operators. “The goal of the P2E initiative is to create a brighter, more sustainable future for youth and small businesses by taking an innovative approach to developing solutions to respond to the urgent unmet needs created by the pandemic.”