Presentation address the present reality of microinsurance units and sustainability. States that rare events can bankrupt the miu and that common causes of insolvency are:
* income side problems
* expenditure side vulnerabilities
* management shortcomings
Gives details of work in the Philippines, measures, indicators and donor relationships. Concludes that:
* MIUs must address funding issues and random clustering in outlier risk
* without risk transfer, MIUs incur a 40% chance of insolvency (or more)
* pooling does not provide a satisfactory solution
* MIUs need an option to transfer risk
* reinsured mius eliminate their risk of insolvency due to random clustering of outlier risks
* reinsured MIUs do not need contingency reserves
* reinsured MIUs get support in improving their information base and in managing risk professionally
