Drought is insurable
Minimizing drought losses for agriculture with innovative solutions
Swiss Re's Soil Moisture Deficit Index Insurance protects farmers against the financial losses caused by drought. We have developed an innovative solution for drought related losses, applicable to all rain fed agricultural production worldwide.
Due to climate change, both the frequency and impact of droughts may increase in the future and worsen the already difficult situation for the local farmers. With an efficient insurance protection, farmers can invest more in production and as such reduce the volatility of their income.
Swiss Re's innovative drought solution is available in several countries in Europa, most prominently; the solution has fully integrated in Kazakhstan agriculture management platform using block chain technology. Serving as risk management solution for one of the largest grain producers and exporters in the world.
About the Soil moisture solution
Swiss Re, in close cooperation with the Dutch specialist company "VanderSat", developed an effective soil moisture deficit index insurance. Contrary to traditional crop insurance where insurance payout is based on loss adjustment in the field, Swiss Re's index insurance pays out in case the soil moisture deficit reaches a pre-defined level. The soil moisture deficit is closely linked to the drop in yield that occurs due to drought.
The advantages of Swiss Re's solution:
- Soil moisture is a parameter that is intuitively understood by farmers
- We use daily soil moisture data. The satellites are not disturbed by clouds, so daily is really daily
- The soil moisture insurance product is transparent and cost effective
- The insurance process can be fully digitized and run over block chain
- The set-up and the insurance product can be scaled easily:
- to cover large area's (Kazakhstan, Australia, Russia)
- to cover millions of farmers (Asia, Africa)
Swiss Re's Soil Moisture Deficit Index Insurance is applicable worldwide. Find out how we can together develop innovative solutions for the agro business in your market.