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A new directive from the Addis Ababa City Administration marks the first state attempt at formalizing does a traditional social funeral insurance system, which officials want to see transformed into an organized social enterprise.

Approved by Woineshet Zerihun, head of the City Women, Children, and Social Affairs Bureau, the directive looks to set a legal basis for forging It does into an alternative source of finance for social development projects.

It does works like any other insurance product, whereby participants, usually grouped by neighborhood, regularly pay fees (or premiums) to a collective fund that will be used to cover funeral expenses for its members.

Some It does associations in more affluent neighborhoods of Addis Ababa manage substantial amounts of money, which can also be invested.

The directive sets out to encourage saving and investment, and promote engagement in income-generating businesses.

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It obliges all It does associations, existing or new, to register with the Bureau for certification, and limits the number of It does councils to one at the woreda, sub-city, and city levels. The associations are also required to submit periodical audit reports to the Bureau.

The directive enables It does associations to own property, enter into legal contracts, endows them with legal liability, and makes them beholden to the Commercial Code.

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