Your search found 10 records
1 Aheeyar, Mohamed; Samarakoon, Kalani; de Silva, Sanjiv. 2021. Bundled weather index insurance pilot for drought-affected areas in Sri Lanka: reaching marginal farmers. Colombo, Sri Lanka: International Water Management Institute (IWMI). 35p. (IWMI Working Paper 201) [doi: https://doi.org/10.5337/2021.233]
Weather index insurance ; Crop insurance ; Drought ; Pilot projects ; Farmers organizations ; Advisory services ; Awareness-raising ; Arid zones ; Climate change ; Crop losses ; Compensation ; Risk transfer ; Disaster risk reduction ; Resilience ; Decision making ; Insurance premiums ; Cost benefit analysis ; Equity ; Stakeholders ; Partnerships ; Gender ; Women ; Smallholders ; Landlessness ; Communities ; Households ; Socioeconomic environment ; Mobile phones ; Models / Sri Lanka / North Central Province / Galenbindunuwewa / Dunumadalawa
(Location: IWMI HQ Call no: IWMI Record No: H050840)
(3.07 MB)
Drought is an almost annual phenomenon in Sri Lanka, occurring at varying degrees of severity and affecting many parts of the country. These droughts cause significant damage to agriculture and other economic and social activities. This paper assesses the effectiveness of satellite-based weather Index insurance (WII) bundled with real-time climate and agronomic advisory services provided to farmers’ mobile phones. The aim is to enhance the drought resilience of diverse groups of farmers by providing solutions and strategies to extend bundled insurance products to more people and address equity issues.
In this pilot, an insurance product was introduced to farmers in a village in the North Central Dry Zone of Sri Lanka. WII products are seen as a part of the solution to reducing farmers’ risk to climate change. However, in many places, the structure of insurance schemes in the agriculture sector has failed to reach small-scale and marginal farmers who are most in need of risk transfer mechanisms. Based on a farmer survey, we extracted lessons from implementing a bundled insurance scheme as a pilot project to explore the utility of farmer organizations as an entry point for engaging different farmer groups and ensuring they can understand the WII insurance products and can make informed choices.
The survey results show that efforts made at the outset to understand contextual issues and challenges contributed to an effective product design and rollout approach. The rollout was more effective due in part to a partnership with an established local organization while adopting an aggregator model. Covid-19 mobility restrictions prevented full implementation of the rollout.
Index insurance bundled with mobile weather and agronomic advisories increased farmer resilience and reached diverse groups. Farmers emphasized that being able to assess the costs and benefits based on understanding how key elements of the product work is key to their future engagement with such products, which highlights the importance of investing in awareness raising through a blend of print, verbal and visual tools that make complex products understandable to stakeholders with low levels of literacy.
In this pilot, an insurance product was introduced to farmers in a village in the North Central Dry Zone of Sri Lanka. WII products are seen as a part of the solution to reducing farmers’ risk to climate change. However, in many places, the structure of insurance schemes in the agriculture sector has failed to reach small-scale and marginal farmers who are most in need of risk transfer mechanisms. Based on a farmer survey, we extracted lessons from implementing a bundled insurance scheme as a pilot project to explore the utility of farmer organizations as an entry point for engaging different farmer groups and ensuring they can understand the WII insurance products and can make informed choices.
The survey results show that efforts made at the outset to understand contextual issues and challenges contributed to an effective product design and rollout approach. The rollout was more effective due in part to a partnership with an established local organization while adopting an aggregator model. Covid-19 mobility restrictions prevented full implementation of the rollout.
Index insurance bundled with mobile weather and agronomic advisories increased farmer resilience and reached diverse groups. Farmers emphasized that being able to assess the costs and benefits based on understanding how key elements of the product work is key to their future engagement with such products, which highlights the importance of investing in awareness raising through a blend of print, verbal and visual tools that make complex products understandable to stakeholders with low levels of literacy.
2 Agudo-Dominguez, A.; Perez-Blanco, C. D.; Gil-Garcia, L.; Ortega, J. A.; Dasgupta, S. 2022. Climate-sensitive hydrological drought insurance for irrigated agriculture under deep uncertainty. Insightful results from the Cega River Basin in Spain. Agricultural Water Management, 274:107938. [doi: https://doi.org/10.1016/j.agwat.2022.107938]
Drought ; Weather index insurance ; Hydrological factors ; Irrigated farming ; River basins ; Climate change ; Crop insurance ; Water allocation ; Irrigation ; Microeconomics ; Models ; Uncertainty / Spain / Cega River Basin
(Location: IWMI HQ Call no: e-copy only Record No: H051466)
https://www.sciencedirect.com/science/article/pii/S0378377422004851/pdfft?md5=0bcfe924f191012b1592a2b975ae8d54&pid=1-s2.0-S0378377422004851-main.pdf
https://vlibrary.iwmi.org/pdf/H051466.pdf
https://vlibrary.iwmi.org/pdf/H051466.pdf
(5.24 MB) (5.24 MB)
This paper assesses the feasibility and robustness of an index-based insurance scheme against hydrological droughts under climate change. To this end, we develop a grand ensemble that samples both modeling and scenario uncertainty in the estimation of the insurance risk premium, so to reveal potential unfavorable surprises and minimize regret in the design of the proposed insurance scheme. The grand ensemble combines four microeconomic models and seven GAMLSS models, which are run for three alternative climate change scenarios: stationary climate/no climate change, RCP 2.6, and RCP 8.5. Methods are illustrated with an application to the Cega River Sub-basin (CRS) in central Spain. Results indicate that for a conventional deductible of 30%, the proposed index-based insurance scheme would be actuarially feasible and affordable under all models for the stationary climate scenario (i.e., robust). For climate change scenarios RCP 2.6 and 8.5 and a 30% deductible, the suggested index-based insurance would be actuarially feasible under most models, albeit some outliers point towards potential unfavorable surprises. Lower deductibles decrease feasibility, particularly for deductibles <10%.
3 International Water Management Institute (IWMI). 2022. IWMI Annual report 2021. Colombo, Sri Lanka: International Water Management Institute (IWMI). 58p. [doi: https://doi.org/10.5337/2022.209]
Water management ; Water security ; Research programmes ; Farmer-led irrigation ; Solar powered irrigation systems ; Weather index insurance ; Sustainable Development Goals ; Environmental flows ; Irrigation systems ; Agrifood systems ; Innovation ; Ecosystems ; Climate change ; Climate resilience ; Water law ; Gender equality ; Social inclusion ; Women ; Partnerships / Africa / Middle East / North Africa / South Asia / Nepal / South Africa
(Location: IWMI HQ Call no: IWMI Record No: H051770)
(5.44 MB)
4 Malambo, M.; Tembo, M. C.; Chapoto, A.; Matchaya, Greenwell; Kasoma-Pele, Winnie; Aheeyar, Mohamed; Ebrahim, Girma; Ajayi, O. C.; Afun-Ogidan, K.; Fakudze, Bhekiwe. 2023. Digital adaptation in agriculture profile for Zambia. Colombo, Sri Lanka: International Water Management Institute (IWMI); Rotterdam, Netherlands: Global Center on Adaptation; Abidjan, Cote d’Ivoire: African Development Bank. 74p.
Climate change adaptation ; Agricultural sector ; Digital technology ; Disaster risk management ; Information and Communication Technologies ; Climate prediction ; Weather forecasting ; Weather index insurance ; Water management ; Vulnerability ; Resilience ; Innovation ; Investment ; Electricity supplies ; Infrastructure ; Gender ; Women ; Stakeholders ; State intervention ; Private sector ; River basins / Zambia / Zambezi River Basin
(Location: IWMI HQ Call no: e-copy only Record No: H052084)
https://www.afdb.org/en/documents/digital-adaptation-agriculture-profile-zambia
https://vlibrary.iwmi.org/pdf/H052084.pdf
https://vlibrary.iwmi.org/pdf/H052084.pdf
(5.74 MB) (5.74 MB)
5 Aheeyar, Mohamed; Amarasinghe, Upali; Amarnath, Giriraj; Alahacoon, Niranga. 2023. Factors affecting willingness to adopt climate insurance among smallholder farmers in Sri Lanka. Climate Risk Management, 42:100575. [doi: https://doi.org/10.1016/j.crm.2023.100575]
Weather index insurance ; Willingness to pay ; Smallholders ; Farmers ; Crop insurance ; Agricultural insurance ; Climate change ; Drought ; Natural disasters ; Vulnerability ; Resilience ; Risk transfer ; Risk management ; Irrigated farming ; Rainfed farming ; Households ; Socioeconomic aspects / Sri Lanka / North Central Province / Anuradhapura / Galenbindunuwewa
(Location: IWMI HQ Call no: e-copy only Record No: H052411)
https://www.sciencedirect.com/science/article/pii/S2212096323001018/pdfft?md5=93cee7b9bb8baaad811ae19ab6f2e4b7&pid=1-s2.0-S2212096323001018-main.pdf
https://vlibrary.iwmi.org/pdf/H052411.pdf
https://vlibrary.iwmi.org/pdf/H052411.pdf
(1.14 MB) (1.14 MB)
Drought is an almost annual phenomenon affecting many parts of Sri Lanka, causing huge damage to agriculture and losses to the broader economy in general and farmers in particular. Climate change threatens to exacerbate these risks. Risk transfer mechanisms, such as crop insurance schemes, may help buffer farmers against these hazards and has gained attention as an adaptation response to become an important element in agricultural risk management. Despite the numerous efforts over several decades to popularize crop insurance as a risk transfer tool in the country under heavy subsidies, farmers’ voluntary enrollment in crop insurance has been very low. Therefore, understanding the farmers’ behaviors and attitudes towards crop insurance and the potential of such programs in emerging climate-induced vulnerabilities is critical to enhancing the welfare of the farming community. This paper assesses the factors that influence willingness to enroll for crop insurance among farmers in irrigated and rainfed farming system in the drought-prone North Central Province of Sri Lanka using a logistic regression model. The study sample consisted of 149 irrigated farmers and 51 rainfed farmers selected randomly. Regression results show that farmer’s age, agriculture as the primary source of income, irrigation as the source of water, and availability of supplementary water source are significantly related to willingness to pay (WTP) for insurance. The overall results indicate the role of household socioeconomic factors and their contextualized risk perceptions shape the adoption decision of crop insurance. The findings of the paper contribute to that end through primary data from a rainfed and irrigated areas in the province. Although the present research was carried out in a limited area, the study area is dominated by the traditional nature of agricultural practices by smallholder farmers in a drought exposed environment, the findings of the study should apply to the rest of the dry zone areas in the country. The results on factors affecting farmers’ willingness to purchase crop insurance assist the practitioners and policymakers to draft the guidelines and strategies for more inclusive interventions for agriculture risk management and building farmer resilience.
6 Aheeyar, Mohamed; Amarasinghe, Upali A.; Amarnath, Giriraj; Alahacoon, Niranga; Prasad, S.; Dissanayake, A. 2023. Assessment of farmers’ willingness to pay for bundled climate insurance solutions in Sri Lanka. Colombo, Sri Lanka: International Water Management Institute (IWMI). 37p. (IWMI Research Report 187) [doi: https://doi.org/10.5337/2023.222]
Weather index insurance ; Farmers' attitudes ; Willingness to pay ; Assessment ; Climate resilience ; Crop insurance ; Risk transfer ; Climate services ; Seed systems ; Agricultural risks ; Disaster risk management ; Strategies ; Intervention ; Climate change impacts ; Drought ; Flooding ; Crop damage ; Smallholders ; Socioeconomic aspects ; Land ownership ; Household income ; Insurance premiums ; Gender equality ; Social inclusion ; Awareness-raising ; Institutions ; Surveys / Sri Lanka / Anuradhapura / Gampaha / Hambantota / Kurunegala / Monaragala
(Location: IWMI HQ Call no: IWMI Record No: H052415)
(1.68 MB)
With the increasing frequency and intensity of climate-related disasters, several social protection and livelihood resilience tools have been tested to reduce agricultural risks. The findings of this study are based on the initial bundled climate insurance solutions pilot conducted in five districts in Sri Lanka (Anuradhapura, Vavuniya, Monaragala, Kurunegala and Ampara) in 2021 with the support of Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ). The project intervention was designed to reduce production risks and enhance agricultural resilience through the roll-out of an index insurance product bundled with hybrid seeds and mobile-based weather and agronomic advisories. The research assessed farmers' willingness to pay (WTP) for weather index insurance (WII) solutions with bundled choices as a risk transfer tool with due consideration to the diversity and heterogeneity of the farming population. The report informs the scaling opportunities of bundled climate insurance choices, including product design and implementation among smallholder farmers and reduction of production risks in designing and implementing WII products. The study findings confirm the majority of farmers' perceptions of high climate risk, but the degree of risk is variable between areas and different segments of people. Farmers’ age, gender, farming experience, levels of education, land size operated, and household income form the major factors characterizing the diversity and risk exposures. Attention to gender and social equity issues is important in the design and delivery of insurance products so that the benefits of the interventions reach most of the farming population; this can ensure achievement of the larger development objectives of equity and fairness to disadvantaged people including women. Farmers are experiencing high or very high levels of variability in crop yield, input prices and output prices. However, the differences in willingness to experiment with innovations to minimize the risks and adopt risk-taking approaches to minimize production risks and strengthen livelihood resilience indicate the requirement for carefully designed insurance products. Awareness creation is a prerequisite for this intervention to be a sustainable one. About 80% of farmers are willing to enroll in crop insurance programs, but a major inhibiting factor is the lack of trust in insurers. The amount that farmers are willing to pay as an insurance premium is in the range of 1-2% of the sum insured for the majority of farmers. Bundling insurance with farm support services could be the primary strategy for transitioning insurance programs to be a financially viable and sustainable adaptation strategy, and for upscaling these programs.
7 Amarnath, Giriraj; Taron, Avinandan; Alahacoon, Niranga; Ghosh, Surajit. 2023. Bundled climate-smart agricultural solutions for smallholder farmers in Sri Lanka. Frontiers in Sustainable Food Systems, 7:1145147. [doi: https://doi.org/10.3389/fsufs.2023.1145147]
Climate-smart agriculture ; Smallholders ; Farmers ; Weather index insurance ; Crop insurance ; Climate change ; Drought ; Agricultural extension ; Public-private partnerships ; Earth observation satellites ; Climate services ; Seed systems ; Climate resilience ; Advisory services ; Business models / Sri Lanka / Ampara / Anuradhapura / Monaragala / Kurunegala / Vavuniya
(Location: IWMI HQ Call no: e-copy only Record No: H052475)
https://www.frontiersin.org/articles/10.3389/fsufs.2023.1145147/pdf?isPublishedV2=False
https://vlibrary.iwmi.org/pdf/H052475.pdf
https://vlibrary.iwmi.org/pdf/H052475.pdf
(1.34 MB) (1.34 MB)
Smallholder farmers are among the most vulnerable to climate shocks in Sri Lanka. Lack of education and technical skills, poverty, risks inherent to agricultural investments, limited assets, and financial capital are major reasons for low investments in enhancing adaptive capacity. The study explores the use of agricultural technologies in improving smallholder resilience to water-related disasters and their opportunities for recovery. We tested four bundled services to promote climate-smart agriculture practices namely weather index insurance (WII), agronomic advisories dissemination via SMS, weather services, and climate-resilient seeds of maize and rice. The integrated solutions are referred to as Bundled Solutions of Index Insurance with Climate Information and Seed Systems (BICSA) to manage agricultural risks in Sri Lanka. The study conducted the bundled solutions in three agroecological regions spread over five districts and covering more than 2,500 farmers in three cropping periods of Maha and Yala seasons. The results demonstrate that providing bundled solutions significantly protects smallholders against moderate drought events. The satellite-based weather index insurance can offset the long-term consequences of severe yield losses and mitigate the long-term drop in farm productivity. Our findings demonstrate the importance of bundled insurance to mitigate financial risks associated with extreme weather events and enhance resilience to climate change among vulnerable smallholders. It is evident from the study promoting a viable business model among seed companies, insurance companies, and technological partners, along with public institutions such as agricultural extension services can help production-level improvements and develop strategies at both the farm and policy levels that will support a transition to a more resilient farming system.
8 Lan, L.; Mushtaq, S.; Wang, Q. (J.); Barlis, A.; Deniau, A.; Byrareddy, V. M.; Anh, H. T.; Swaans, K. 2024. Are Vietnamese coffee farmers willing to pay for weather index insurance?. International Journal of Disaster Risk Reduction, 100:104185. [doi: https://doi.org/10.1016/j.ijdrr.2023.104185]
Coffee ; Farmers ; Willingness to pay ; Weather index insurance ; Contingent valuation ; Climate change adaptation ; Risk ; Extreme weather events ; Crop insurance ; Developing countries ; Rainfall / Vietnam / Lam Dong / Dak Lak
(Location: IWMI HQ Call no: e-copy only Record No: H052449)
https://www.sciencedirect.com/science/article/pii/S2212420923006659/pdfft?md5=e25434daec9092837c94e431f542cc1f&pid=1-s2.0-S2212420923006659-main.pdf
https://vlibrary.iwmi.org/pdf/H052449.pdf
https://vlibrary.iwmi.org/pdf/H052449.pdf
(1.19 MB) (1.19 MB)
Global coffee production experiences detrimental impacts of climate change. Weather index insurance (WII) offers an opportunity for coffee farmers to mitigate the climate risks in production and motivate them to adopt sustainable farming practices. This study explores Vietnamese farmers' willingness to participate and pay for WII schemes for coffee. A contingent valuation survey was employed on a sample of 151 farmers from the two largest coffee production areas: Lam Dong and Dak Lak provinces. The findings revealed that farmers are willing to pay, on average, US$92.30 per policy for a premium on insurance products. We also found that farmers in Lam Dong are willing to pay more than those in Dak Lak despite fewer Lam Dong farmers being willing to participate in the insurance schemes. The majority of farmers prefer drought to be insured within 3 months of coffee blossom, from February to April. Factors influencing farmers' decision to join the insurance schemes include education, farm size, climate change perception and experiences, and insurance knowledge. The study suggests that the current coffee industry co-contribution to insurance premiums could potentially be reduced by up to 90 %. However, caution must be taken when adjusting co-contribution, as farmers' willingness to pay is heterogeneous. In addition, raising awareness of the impact of climate change on crop production and insurance knowledge training is critical to ensure an increased number of participants in the schemes. The recommendations from this study will contribute to improving the design of coffee insurance products that are tailored to local needs and preferences and will assist in upscaling the products’ outreach in the Coffee Climate Protection Insurance Program.
9 Batra, N.; Amarnath, Giriraj. 2023. Development of a flood index insurance product for Zambia. Colombo, Sri Lanka: International Water Management Institute (IWMI). CGIAR Initiative on Climate Resilience. 18p.
(Location: IWMI HQ Call no: e-copy only Record No: H052656)
(1.12 MB)
Weather Risk Management Services Pvt Ltd (WRMS) is collaborating with the International Water Management Institute (IWMI) as part of the CGIAR Initiative on Climate Resilience (ClimBeR) to develop financial solutions for post-extreme climatic events. The focus is on creating parametric insurance solutions to aid vulnerable populations in managing and mitigating loss and damage caused by natural disasters, with a primary emphasis on floods. The project's scope involves a comprehensive approach to enhance community resilience through financial solutions for flood. It begins with identifying vulnerable locations using secondary data sources. The subsequent steps include developing parametric insurance products, setting triggers and damage ratios based on past events, and evaluating community vulnerability. Zambia is particularly prone to seasonal floods from November to April. Major rivers like Zambezi, Kafue, and Luangwa can lead to widespread inundation, impacting lives, displacing communities, damaging infrastructure, and disrupting agriculture. The project focuses on flood risk in specific regions, the Kafue flats area in Lusaka and Southern Provinces. Data sources crucial for assessing flood severity include river water level, dam discharge data, and rainfall. The study utilizes historical data from 1980-2023 for water level and discharge, and 2000-2020 for rainfall, collected from multiple locations in the Kafue plains area. The development of the flood index-based insurance product involves analyzing data to determine triggers for flash floods and riverine floods. The shortlisted region experienced severe flooding in the past, and detailed analysis has been done to validate if the collected data sets capture both the intensity and duration of those extreme events. The proposed index insurance product features triggers based on water level and rainfall data, offering fast and transparent settlement with low administrative costs. For riverine floods, payouts depend on the increase in daily water level from a set benchmark, considering the number of days above the threshold. For flash floods, compensation is triggered by excess rainfall over a specified period. Ultimately, the project aims to offer a combined flood coverage product addressing both flash and riverine floods, contributing to the overall goal of strengthening disaster resilience through integrated risk analysis, financial solutions, and actionable protocols.
10 Amarnath, Giriraj; Umer, Yakob; Makungwe, Mirriam; Jacobs-Mata, Inga; Mvula, C. 2023. Stakeholder consultation, site prioritization, and flood model development for Index-based Flood Insurance in Southern Province, Zambia. Colombo, Sri Lanka: International Water Management Institute (IWMI). CGIAR Initiative on Diversification in East and Southern Africa. 17p.
Weather index insurance ; Flooding ; Multi-stakeholder processes ; Modelling / East Africa / Southern Africa / Zambia
(Location: IWMI HQ Call no: e-copy only Record No: H052677)
(1.79 MB)
The Index-based flood insurance (IBFI) is one of the outputs of the research under the initiative on Diversification in East and South Africa (UU), Work Package two (WP2): Bundling climate insurance solutions focusing on a case study in districts in Southern part of Zambia. This research was developed by the International Water Management Institute (IWMI) co-designed with an insurance institution and insurance product developers and co-implemented with the Ministry of Agriculture (MoA) and Disaster Management and Mitigation Unit (DMMU) of Zambia. The first part of the study covers Flood index development from observed rainfall and river stream flows, and flood model development to produce flood parameters in terms of flood depth, flood duration, and extent - complemented with remote sensing flood inundation to develop flood index products. The second part of the study focuses on interaction with the community, which is gender-sensitive, and stakeholder engagement at all levels. The development of the IBFI also relies on previous – post surveys on the IBFI implementation experience from insured communities. This report consists of the activities we have undertaken to operationalize the IBFI implementation in Zambia. Satellite flood maps were produced to indicate the hazardous location and extent of flood impact in the southern province of Zambia that occurred at the beginning of 2023. The flood maps were used as a benchmark for IBFI product development in the pilot area. Multi-level stakeholder consultation has been conducted – first, a District-level stakeholder consultation aiming at site prioritization, knowledge sharing, and understanding the level of flood impact on the livelihoods. Second, stakeholder consultation with higher officials in Lusaka from the MoA, Zambia Meteorological Department (ZMD), Water Resources Management (WARMA), World Food Program (WFP), insurance institutions, and product developers. The meeting was aimed at laying a road map on how to co-develop and co-implement the index-based flood insurance in the selected pilot area. Together with stakeholders engaged in the district and complimented with earth observation flood maps, Namwal District, which is in the southern province of Zambia has been prioritized for bundling IBFI. Tabular data on the flood exposure elements from the district has been shared with IWMI, as presented in this report, which will be analyzed and used to support the development of IBFI products. The first phase of product development for IBFI is to use observed data to produce the indices. Here, the observed rainfall, stream flow, and water level data were used to produce a design flood index insurance product in the Kafue flats. The second phase of the design of the flood index insurance product will be produced using flood modeling. So far, the flood model tool has been developed to produce flood parameters that will be used for insurance product development and the calibration and validation of the model is in progress.
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