A2ii-IAIS Public Dialogue - Index Insurance Innovations, Challenges, and Regulatory Trends
On 7 May 2025, the Access to Insurance Initiative (A2ii), in partnership with the International Association of Insurance Supervisors (IAIS), hosted a Public Dialogue on Index Insurance Innovations, Challeges and Regulatory Trends, bringing together regulators, development partners, and industry representatives from Asia and Africa. The discussion focused on regulatory developments, product design, and innovative approaches to enhancing climate resilience through index-based insurance solutions.
In his opening remarks, Conor Donaldson, Head of Implementation at IAIS emphasized the importance of such dialogues in advancing inclusive insurance and closing protection gaps. He highlighted the relevance of parametric insurance for underserved markets and aligned the topic with the IAIS’s 2025–2029 Strategic Plan, which prioritizes insurance's role in building societal resilience.
Matthias Range Executive Director at A2ii welcomed participants, noting the critical role of index insurance in protecting vulnerable communities and recognizing the progress in product innovation over the past decade.
The event featured a presentation by Asmaa Jabri, Advisor at A2ii who explained the mechanics, benefits, and limitations of different index insurance models, including indemnity-based, weather derivatives, and index-based products, with a focus on addressing basis risk.
From Nepal, Pujan Dhungel Adhikari Director at Nepal Insurance Authority shared insights into the country’s vulnerability to extreme weather events, including glacial melt, landslides, and erratic rainfall. He outlined Nepal’s efforts to establish a regulatory framework for index insurance, with clear standards for product approval, pricing, technical validation, and trigger definition. He emphasized the need for continuous supervision, industry capacity building, and collaboration with meteorological and disaster risk management authorities to ensure data accessibility and informed decision-making.
Andrea Camargo, Microinsurance Programmes Lead at World Food Programme, presented WFP’s experience using index insurance to strengthen food security, particularly for smallholder farmers. She identified key supply-side challenges, such as limited technical capacity and risk appetite among local insurers, and demand-side barriers, including affordability and low awareness. She also discussed policy challenges, highlighting the critical role of supportive regulation and the importance of engaging with regulators early to enable pilot projects. Andrea shared examples of successful implementations in The Gambia and Ethiopia, demonstrating how effective partnerships can foster product development and adoption. She also discussed the potential of digital tools, such as satellite data, mobile platforms, and digital payments, to enhance product design and distribution—while noting the persistent infrastructure and cost-related hurdles.
Gloria Womitso (Africa Risk Capacity) addressed the perception of parametric insurance as a niche solution, often disconnected from broader national disaster response frameworks and social protection systems. She stressed the importance of building trust, increasing transparency, and strengthening collaboration between governments, insurers, and development partners. Gloria also pointed to the urgent need for technical capacity building across the insurance value chain, especially in data management and operational infrastructure.
During the panel discussion, speakers identified several critical barriers to index insurance uptake, including:
- Unrealistic expectations around product performance;
- A lack of fit-for-purpose products tailored to the needs of vulnerable groups;
- A disconnect from community-level needs and low awareness among potential clients;
- Gaps in regulatory frameworks that either overly restrict or insufficiently guide innovation.
The event concluded with a call to action for continued regulatory development, capacity-building initiatives, and multi-stakeholder engagement. The following priority actions were identified:
- Finalize and implement a regulatory framework for index insurance in Nepal that supports innovation while ensuring consumer protection.
- Develop training and certification programmes for regulators and industry practitioners.
- Strengthen collaboration with meteorological agencies and disaster authorities to improve data access and quality.
- Establish an Insurance Information Bureau to support evidence-based supervision and product development.
- Continue and evaluate pilot projects in collaboration with ARC and A2ii to draw lessons for broader implementation.
- Explore new product design approaches, including photo-based indices, to enhance product relevance and performance.
The Dialogue reaffirmed A2ii’s and IAIS’s shared commitment to fostering responsible, inclusive insurance systems that are resilient to climate risks and responsive to the needs of the most vulnerable.
Event announcement:
The Access to Insurance Initiative (A2ii), in partnership with the International Association of Insurance Supervisors (IAIS), held a Public Dialogue on index insurance and climate risk on May 7, 2025, at 10:00 CEST via Microsoft Teams.
The webinar brought together regulators and industry representatives from diverse regions to discuss emerging trends in the regulation of index insurance. Key topics included evolving regulatory approaches, consumer protection considerations, and the role of technology in enhancing product reliability. The discussion also addressed some of the limitations of index insurance, such as basis risk, data quality, affordability, and accessibility challenges.
By facilitating dialogue between supervisors and industry experts, the event aimed to highlight regulatory good practices that strike a balance between innovation and consumer protection. Participants gained valuable insights into the opportunities and constraints shaping the use of index insurance as a tool for managing climate risks.
Speakers included:
Andrea Camargo, Microinsurance Programmes Lead at the World Food Programme
Pujan Dhungel Adhikari, Director at the Nepal Insurance Authority
Gloria Womitso, from Africa Risk Capacity
The event was conducted in English and open to all interested stakeholders.
The recording of the dialogue is available:
