Insurance for MSMEs - A GIZ Compendium

Micro, small and medium-sized enterprises (MSMEs) are the backbone of many economies globally. They are key contributors to economic growth, employment, and innovation. At the same time, MSMEs are constrained by limited access to financial services including insurance.

Financial losses from an adverse event often exceed what MSMEs can cover with informal risk mitigation mechanisms or reserves. The ongoing global COVID-19 crisis has, once again, highlighted the extreme vulnerability of MSMEs to exogenous shocks and risks. Formal insurance products are a crucial tool to increase the resilience of MSMEs, spur business investments and, thereby, contribute to the growth of the enterprises and the economy at large. However, the uptake and use of insurance remains very low among MSMEs; often because insurance offerings are not adapted to their needs. This, in turn, leads to a large and persistent gap in insurance provision for MSMEs.

GIZ is working on bridging this gap. The “Insurance for MSMEs Compendium” provides insights on how GIZ is improving the provision of insurance for MSMEs in a number of countries. The work compiled in this compendium includes knowledge building products, training concepts for MSMEs and the insurance industry as well as innovative approaches to design and deliver insurance and risk management services for MSMEs.