Ecuador

Overview

Ecuador’s geography means it faces high risk from earthquakes, volcanic eruptions, landslides and hydrometeorological phenomena, such as El Niño and La Niña. The COVID-19 pandemic increased income inequality, putting vulnerable groups at higher risk. Inclusive insurance and risk transfer solutions can help protect the population and grow the economy sustainably.
UNDP’s Insurance and Risk Finance Facility is working in Ecuador to build the enabling environment for inclusive insurance development and to increase the available risk transfer solutions to protect essential economic sectors.

Main Natural Hazards

Earthquake, Tsunami, Flood,

Drought

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¹
Source:

https://drmkc.jrc.ec.europa.eu/inform-index/INFORM-Risk/Country-Risk-Profile}

Insurance penetration

2.1% (2022)

^{1

¹
Source:

https://www.swissre.com/institute/research/sigma-research/sigma-2023-03.html}

Number of insurance providers

30 insurance companies

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¹
Source:
Forthcoming UNDP diagnostic}

% Workforce engaged in agriculture

32% (2022)

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¹
Source:

https://data.worldbank.org/indicator/SL.AGR.EMPL.ZS}

Multidimensional poverty

3% (2018)

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¹
Source:

https://hdr.undp.org/system/files/documents/hdp-document/2023mpireporten.pdf}

% of population covered by inclusive insurance products

^{1

¹
Source:
The Microinsurance Network, Landscape of Microinsurance 2023, Based on target population estimate for Ecuador of 14,516,595 people https://microinsurancenetwork.org/resources/the-landscape-of-microinsurance-2023}

Biodiversity ranking

#9 out of 239 countries and territories (2023)

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¹
Source:

https://worldrainforests.com/03highest_biodiversity.htm}

Small business % contribution to workforce

60% of total employment (2020)

^{1

¹
Source:

https://www.worldbank.org/en/news/press-release/2020/07/01/ecuador-micro-pequenas-medianas-empresas}

Our work in numbers

700K

Million projected beneficiaries

Reaching people through insurance and risk finance solutions.

2

Insurance solutions in development

Protecting people, jobs, agriculture and public assets.

2

Institutional and policy processes

Strengthening the enabling environment for insurance to scale.

64

Training programme participants

Building country capacity in insurance and risk finance.

Our projects

Collaborating to develop risk finance and insurance solutions
The Tripartite Agreement (TPA) is a public-private partnership between UNDP, 20 of the world’s largest insurers under the framework of the Insurance Development Forum and the German Federal Ministry of Economic Cooperation and Development (BMZ). Through TPA, UNDP is working with Ecuador’s government and insurance industry to develop parametric insurance solutions that can increase financial protection in the face of disaster risks. UNDP is also working with government and industry partners to increase capacity and improve the regulatory environment for insurance development.

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Increasing actuarial capacity to improve financial risk management
The UNDP Milliman Global Actuarial Initiative (GAIN) aims to help countries predict and prepare for risks by increasing actuarial capacity, enabling better risk modelling and more accurate pricing of insurance and social protection mechanisms. In cooperation with local insurance authorities, the GAIN initiative is working to improve actuarial capacity in Ecuador through creation of a master’s degree in actuarial sciences (the first in the country), training, mentorship programmes and support for local actuarial professionals.

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Incentivizing the development of new insurance products and services across emerging economies
UNDP’s Insurance Innovation Challenges are powering a new generation of insurance products and services tailored to underserved households and businesses in developing economies.
- Active in 25 countries, with an investment of over US$2.1 million
- Addressing specific barriers and opportunities to scale financial protection, with a particular focus on women, SMEs and other vulnerable groups
- Creating market opportunities for insurance providers and safeguarding development.
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Ecuador’s insurance regulator is currently designing a draft national regulation aimed at adopting the principles of the European Union’s Solvency II regulatory framework, adapted to the local conditions of the insurance sector in Ecuador. UNDP has supported capacity-building training on Solvency II and a diagnostic is under development to evaluate normative and regulatory gaps in the insurance industry.