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Upcoming and past events from the UNDP Insurance and Risk Finance Facility.
Kuala Lumpur – On March 6th 2024, Generali and the United Nations Development Programme (UNDP) convened representatives from the Malaysian Ministry of Finance, Bank Negara Malaysia, the SME Association of Malaysia and the insurance and financial communities, to present concrete solutions to boost small business resilience against climate change and other risks.
Micro, small and medium-sized enterprises (MSMEs) make up 97% of the private sector in ASEAN countries, acting as both a pillar and a driver of socio-economic development. Their growth and survival are threatened by a wide range of long-standing challenges. These include access to financing, limited human resources and limited use of technology– but also rapidly rising risks, in particular our changing climate (eg. the direct impact of flooding or cyclones, or the increasing burden of heat stress) and health crises such as the recent pandemic.
These threats are intensified by the lack of risk management, coping mechanisms, and insurance coverage. Fewer than 5% of MSMEs in the ASEAN region are estimated to have any form of insurance, according to the UNDP-Generali report “Building MSME Resilience in Southeast Asia” launched at the event.
The report focuses on Thailand and Malaysia, proposing a new approach to identifying MSME risks and specific needs by segmenting priority value chains such as natural rubber, food and accommodation, wholesale and retail, and electrical and electronics. From this, the report details holistic solutions that consider both risk transfer and risk mitigation tools, and which include bundling insurance with new technologies or digital platforms.
Generali and UNDP also released the SME Loss Prevention Framework, a digital tool leveraging data to raise the readiness and awareness of SMEs to climate and weather-related risks, starting in Malaysia with the flood risk. This free online tool, hosted on a user-friendly platform, will be available for use by Malaysian SMEs. A mobile app is being developed and will be replicated for use in other Asia countries.
Following on from the launch of the UNDP Generali Insurance Innovation Challenge Fund for Malaysia in September 2023, the event also showcased four innovative solutions for insurance to enhance SME resilience against climate and other risks.
In the upcoming months, finalists will be announced, of which two winners will be awarded up to US $40,000 each, along with technical assistance to support the development of their ideas and the opportunity to leverage Generali and UNDP’s global presence.
The event builds on a multi-year partnership between Generali and UNDP’s Insurance and Risk Finance Facility, a part of UNDP's Sustainable Finance Hub. The partnership is working to reduce the protection gap for vulnerable communities worldwide through access to insurance solutions. This work aligns with a broader commitment to raise awareness and set the path for insurance to unlock security, sustainability, and greater resilience for SMEs in developing countries.
The broader UNDP- Generali partnership
The United Nations Development Programme and Generali have partnered to support developing countries with access to insurance and risk finance solutions that enhance the resilience of communities and local businesses. Under this multi-year partnership, Generali has committed technical and financial resources to UNDP’s Insurance and Risk Finance Facility (IRFF), a part of UNDP's Sustainable Finance Hub, in order to increase the socioeconomic wellbeing of some of the world’s most vulnerable people and places. The partnership blends Generali’s insurance expertise with UNDP’s long-term focus on financing and development.
Moreover, through the partnership, Generali and UNDP are contributing towards the InsuResilience Vision 2025, which includes: reaching 500 million vulnerable people and covering them against climate and disaster shocks; protecting 150 million vulnerable people through microinsurance solutions; and putting insurance innovation at the heart of the UN’s Sustainable Development Goals and 2030 Agenda.
THE GENERALI GROUP:
Generali is one of the largest global insurance and asset management providers. Established in 1831, it is present in over 50 countries in the world, with a total premium income of € 81.5 billion in 2022. With 82,000 employees serving 68 million customers, the Group has a leading position in Europe and a growing presence in Asia and Latin America. At the heart of Generali’s strategy is its Lifetime Partner commitment to customers, achieved through innovative and personalised solutions, best-in-class customer experience and its digitalised global distribution capabilities. The Group has fully embedded sustainability into all strategic choices, with the aim to create value for all stakeholders while building a fairer and more resilient society.
About UNDP:
UNDP is the leading United Nations organization fighting to end the injustice of poverty, inequality, and climate change. Working with our broad network of experts and partners in 170 countries, we help nations to build integrated, lasting solutions for people and planet. UNDP’s Insurance and Risk Finance Facility (IRFF) is a flagship initiative housed within the organization’s Sustainable Finance Hub. It is currently working in 34 countries and will move to 50 countries by 2025. All of the IRFF work is aligned to the goals of the InsuResilience Vision 2025 which aims to cover 500 million people with insurance solutions in developing countries in the next three years.
"With SMEs making up 48.2% of national employment and 38.4% of GDP, the crucial role they play in the economic ecosystem is beyond doubt. Yet they remain most vulnerable to shocks, whether from natural disasters exacerbated by climate change, pandemics or other disruptions to the manufacturing or logistics continuum. We must rapidly support the building of resilience and staying power of SMEs against all foreseeable risks through holistic and innovative instruments and solutions. Insurance would be one of the most significant safety nets for SMEs."
— Niloy Banerjee , Resident Representative, UNDP, Malaysia
“In the ASEAN, where MSMEs make up 45% of regional GDP, their vulnerability to rapidly rising risks is not only a development challenge but an immense opportunity for public and private sectors to come to together and help businesses develop their capacity to understand and manage these risks”
— Jan Kellett, Global and Corporate Lead on Insurance and Risk Finance, Head of the Insurance and Risk Finance Facility, UNDP
“The MSME community in Malaysia, Thailand and the broader Asia region are an indispensable part of the growth and development stories of these markets. However, they face very real and intensifying risks from climate change and other factors that are affecting business continuity and their ability to capture emerging opportunities. Insurance is at the heart of the solution for making SMEs and MSMEs more resilient and is the driving force behind Generali’s partnership with UNDP. Bringing SME EnterPRIZE to Asia, launching our SME Loss Prevention Framework and progressing our Insurance Innovation Challenge Fund are key milestones in our effort to support vulnerable businesses in Asia. I’m eager to continue our collaboration with UNDP and find new ways to make a lasting impact.”
— Jaime Anchústegui Melgarejo , CEO , International of Generali
“In the ASEAN, where MSMEs make up 45% of regional GDP, their vulnerability to rapidly rising risks is not only a development challenge but an immense opportunity for public and private sectors to come to together and help businesses develop their capacity to understand and manage these risks”
— Jan Kellett, Global and Corporate Lead on Insurance and Risk Finance, Head of the Insurance and Risk Finance Facility, UNDP
“The MSME community in Malaysia, Thailand and the broader Asia region are an indispensable part of the growth and development stories of these markets. However, they face very real and intensifying risks from climate change and other factors that are affecting business continuity and their ability to capture emerging opportunities. Insurance is at the heart of the solution for making SMEs and MSMEs more resilient and is the driving force behind Generali’s partnership with UNDP. Bringing SME EnterPRIZE to Asia, launching our SME Loss Prevention Framework and progressing our Insurance Innovation Challenge Fund are key milestones in our effort to support vulnerable businesses in Asia. I’m eager to continue our collaboration with UNDP and find new ways to make a lasting impact.”
— Jaime Anchústegui Melgarejo, CEO , International of Generali
“Promoting a culture of sustainability among SMEs and ensuring their financial resilience means supporting sustainable development and reducing the protection gap for vulnerable communities. This is why we have developed SME EnterPRIZE, our flagship initiative which supports SMEs in their transition to socially and environmentally sustainable business models. And today, it is with great pride that we see this project growing also in Asia, building on the engagement carried out with thousands of SMEs from across Europe over the past years. We firmly believe public-private partnerships and the direct involvement of SMEs themselves will be critical to achieve the goals that we share with UNDP: that is how we will remain on the right track to build a more inclusive and greener future, for people and the planet.”
— Lucia Silva, Chief Sustainability Officer, Generali Group
“MSMEs have long been a key driver of growth and innovation in Asia. Their contributions to the development of this region are indisputable, yet they are increasingly vulnerable to risks flowing from climate change, geopolitical tensions and market disruptions. Our partnership with UNDP recognises these challenges and is aimed at utilising insurance and risk finance solutions to increase coverage among MSMEs and boost their resilience. The various initiatives are all designed to meet businesses where they are in their journeys and ensure they have access to the solutions they need to thrive. I’m grateful for the hard work that has gone into this partnership so far, and I look forward to what more we can achieve together in the future.”
— Rob Leonardi, Regional Officer, International – Asia, Generali
