Verena Wilhelm

Weather Index-basedmicroinsurancein Developing Countries: Analysis and Evaluation Verena Wilhelm

A bigger part of the population lives in low-income countries and is primarily dependend on agriculture. Not only, but also as a consequence of the ongoing climate change, these people are ever more exposed to natural hazards such as drought or floods, endangering their harvest and their lives. Weather index-based microinsurance is a new promising tool for the poor, especially designed to overcome the problems brought along by other financial instruments like credit, savings or foreign aid. Index-based microinsurance addresses the core problem of the poor: food insecurity. Lately, several parties, including international organisations, (re)insurance companies, microfinance institutions, NGOs and governments subsidize and project-manage microinsurance projects. It needs a lot of willpower and conviction to offer insurance to thousands of families and farmers, considering the very low premiums paid. Still, the Law of Large Numbers, that is volume, makes this market so attractive. This book offers an analysis of index-based microinsurance. It evaluates wether it is a sustainable instrument to reduce world poverty.