The frequency and intensity of extreme weather events such as droughts, floods, hurricanes and storms tend to increase due to climate change. There is little smallholders can do to cope with the financial impact of an extreme weather event, forcing them to resort to often negative coping strategies such as selling livestock, reducing food consumption or taking children out of school. Moreover, also financial institutions and agribusinesses suffer from loan defaults in the aftermath of extreme weather events.
While agricultural insurance has been around for some time, its significant adoption by smallholders around the world has been limited. Index-based insurance programs, designed to overcome issues like high transaction costs, continue to suffer from low demand. Basis risk, lack of trust, poor financial literacy and distribution challenges remain an issue. However, linking agricultural insurance to either financial products or agricultural input packages can address challenges related to scaling up agricultural insurance and contribute to higher uptake.
- The different pros and cons of linking agricultural insurance to financial products or input packages
- The various reasons why financial institutions or agribusinesses could be interested in adding insurance to their core offerings
- Lessons learned and successes factors from different countries in Sub-Saharan Africa
- Agrotosh Mookerjee, Managing Director and Chief Actuary, Risk Shield Consultants
- Douglas Phineas Daura, Agricultural Insurance Specialist
- Moderator: Robert Fischle, Advisor, Gesellschaft für Internationale Zusammenarbeit (GIZ)
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