LeapFrog is the world’s largest dedicated investor in insurance to people who are poor and excluded. Every day, our team works to help these millions of people to achieve safety and security, often for the first time.
Why insurance? Studies by Nobel laureate Amartya Sen and many others have shown that vulnerable people are more likely to be hit by unexpected shocks, and to be worse-affected when shocks happen.
Families that lose their only productive asset, or their home, or their sole income-earner, can be pushed permanently into poverty – with demonstrated effects even 30 years later. Other families, who have scrimped and saved and climbed out of poverty, find that they fall into poverty again, and have to fight their way out over years – only to be knocked back again.
This is the true cycle of poverty: not hand-to-mouth but rather the effort of years wiped out in a single tragic day. People on the edge of poverty live these daily realities; they lie awake at night worrying their families will lose everything. It is no wonder then that insurance is the first or second most demanded financial product, along with savings, among low-income people worldwide.
Insurance is more than protective, it is enabling. People who are secure can make different daily choices; families can expand their horizons from grappling with daily fears to longer-term investment.
A farmer wants to plant a new crop that will triple his family’s income, but fears that a flood or a drought would leave them destitute; now, with insurance, he knows they are covered, he can take the leap, raising his family out of poverty.
A woman considering whether to send her daughter to work or to school is worried that if a family member falls ill she will need a cash cushion to pay for hospital care; now, with insurance, she knows the family is covered for the worst moments, she can invest in her daughter’s future.
These stories are mirrored for millions of other individuals and families who have finally gained access to financial tools that enable them to take control of their lives – with especially profound consequences for women and girls who are often the most vulnerable. Insurance has been shown to create the context for people to start businesses, access credit, cumulate savings, try new income-raising techniques and activities, and make many other meaningful investments.
LeapFrog is a business not a charity – our financial model, team, and community operate at a level and scale necessary to make a dent on mass poverty.
With over 4 billion people who are low-income globally, charity capital will not solve the problem – rather, the size of the challenge must be matched by the size of the solution.
It is essential to open the gates of the capital markets, through which trillions of dollars flow, and direct that capital productively into emerging markets insurance. By investing in businesses in Africa and Asia that provide affordable insurance, and by massively expanding and enhancing those businesses to millions of needy customers, LeapFrog and its leading investors are opening those gates. Safety nets and springboards can now be provided sustainably, to the majority of humanity, for the first time in history.