Technical Brief: Weather insurance – a viable option in support of the development of Pacific local food crops and fisheries value chains?
Year of Publication: 2019-09-24
Description
In the last two decades, Pacific Island Countries (PICs) have suffered billions of dollars in damage and loss due to catastrophic weather events (e.g. cyclones, floods, drought) and other natural disasters (e.g. volcanic eruptions). The predominantly small size and diverse nature of the production systems make agricultural insurance investments unattractive. Biological assets – crops and livestock – typically fall outside mainstream insurance coverage, particularly for small farmers. Opportunities exist for transferring weather-related risks to insurance products that can benefit producers; but these need to be carefully evaluated in the Pacific context.
This Technical Brief gives an overview on:
- How Weather Index-Based Insurance (WIBI) Works
- Examples from other countries
- What is needed to make WIBI possible in the PICs
- Policy Recommendations