1. Background

DanChurchAid’s (DCA) vision is to strengthen the world’s poorest people in their struggle for a life in dignity. DCA is one of the largest and oldest humanitarian organizations in Denmark, working both with long-term development projects and humanitarian action since 1922. DCA has three thematic priorities: Save lives; Build Resilient Communities; and Fight Extreme Inequalities. DCA's international programmes contribute to the fulfilment of several SDGs, including SDG 2, 5, 8, 13, 16 and 17.

DCA is exploring the feasibility of incorporating pro-poor microinsurance into its programming in Kenya. Despite the noble intentions to enhance risk coverage, the uptake of insurance including micro-insurance remains low amongst the rural farming households and peri-urban communities. DCA therefore conducted a Participatory Market Systems Development (PMSD) research to establish the reasons for this low uptake and develop an intervention model with the long-term objective of contributing to an increased uptake of microinsurance by rural and peri-urban communities that form the most of DCA’s beneficiaries. This is in keeping with DCA’s vision to strengthen the world’s poorest people in their struggle for a life in dignity.

The research revealed that the insurable risks that lead to financial losses among the pro-poor communities are human risks of Loss of Life and Heath, and economic risks of Loss of Income/earning capacity. It emerged that the main economic activity for the population is agriculture- crop and livestock farming. All the population was equally exposed to the financial loss that accompanies loss of life or health of a community member regardless of the economic activity.

2. Purpose & objectives

The findings of the research with the help of an experienced external consultant informed the development of a microinsurance model to be used by DCA for deployment of microinsurance to its beneficiaries. The model proposes inclusion of an adept microinsurer/underwriter to pool and cover the risks described above. DCA therefore is looking for competent microinsurance underwriter(s) to offer microinsurance products and services tailored to the needs of DCA beneficiaries and other communities whose incomes are low and are therefore excluded from conventional insurance.

The key objectives of the assignment are.

1. To provide microinsurance underwriting

2. Product development tailored for the micro-insurance segment

3. To offer training and communication material aimed at catalysing uptake and onboarding into the micro-insurance scheme

3. Scope of engagement & methodology

The insurer will partner with DCA and DCA partners to co-develop microinsurance products comprising of crop insurance, livestock insurance, health insurance, loss of earning capacity/Hospital cash, Life insurance/last expense. The products will be rolled out in the manner described in the Microinsurance model or similar approach which will involve DCA profiling and aggregating beneficiaries, collection and remittance of premium, reporting of claims and follow up for compensation, feedback and communication regarding changes to the insured risks and relevance of products and pricing. The insurer on the other hand is expected to communicate to DCA and beneficiaries on hazard reduction strategies, KYC documents and requirements to enhance efficiency in underwriting and claims settlement and administration and reduce burden of proof. This may involve training of DCA, DCA partners and beneficiaries on products.

On holding cover, the insurer will be expected to run and send monthly reports or on request, of the portfolios of risks insured with them, the loss ratios and the unamortized premium balances/arrears, renewal notices and renewal terms three months to expiry or lapse

4. Desired Microinsurer Capacities and competencies

The microinsurance company/insurer should be competent and experienced in microinsurance and with financial capacity to indemnify beneficiaries promptly after losses related to insured risks (including health and life and economic risks). The company should have strong reinsurance backing for microinsurance, a smooth Enterprise Management System (EMS) and technologically dynamic for underwriting, customer service and claims administration, a good track record of ethical treatment of customers and prompt claims settlement.

Verification documents and information:

• Company profile
• Financial Capacity: three years Audited Financial Statements
• Service charter
• Confidential business questionnaire
• Liquidity ratio
• Microinsurance department/subsidiary claims ratios and underwriting profits
• Proof of payment of microinsurance claims for the past three years
• Licensed for over three years to underwrite microinsurance- Certificate of Registration and IRA Licenses for past three years
• Proof of strong Reinsurance backing for Microinsurance pools (Reinsurance treaty document)
• Inhouse microinsurance strategy- Microinsurance strategy document, Microinsurer subsidiary company Certificate of Incorporation and license, existing microinsurance department/company/subsidiary organogram
• Licensed to underwrite Life assurance and general insurance including medical business (composite insurer)- IRA Licenses
• List of microinsurance products licensed by IRA
• Ex-gratia policy
• Branch network and contacts
• Tax Compliance Certificate

5. Expectations of DCA and Beneficiaries towards the insurer

• Policy documents, policy schedules, benefits, limit bands, terms and conditions should be clear, in simple language and translated to Swahili
• The insurer should be accessible via email, phone and communicate promptly
• The insurer should be willing to sign and adhere to Service Level Agreements (SLAs) and Turn Around Times (TATs) and committed to Responsible Business Conduct (RBC)

6. Duration and time frame

The performance of the insurer will be reviewed at the end of each insurance period or season for decision to renew policies or terminate them. However, DCA is not obliged to insure with any insurer but will be guided by the experience and feedback from beneficiaries and stakeholders, and the level of insurer’s adherence to Service Level Agreements, Turn Around Times and Responsible Business Conduct.

7. Expression of interest submission

DCA invites interested insurance companies/microinsurance companies/Risk pooling organizations to submit their bid and documents of verification indicated in section 4 by 19^th December 2021:

· Expression of interest / cover letter, outlining how the insurer meets the selection criteria and their understanding of the ToR.

· Names and contacts of three recent organisations for whom similar partnership has been done.

· Qualifications/CV’s of Microinsurance staff

· Any other relevant documents

8. Deadlines & submission

· The deadline for submission of EOI is 19^th December 2021: We will take references immediately and notify the selected consultant shortly thereafter. The contract should be signed latest within 10 days after deadline and the work should start immediately thereafter.

· Any questions regarding the assignment should be directed to Area Programme Manager – Mark Abaha mema@dca.dk