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Grantee
Weather Risk Management Services Ltd (WRMS) has played a pioneering role in developing the alternative agriculture insurance market in India to protect Indian farmers. This work involves developing and implementing a weather insurance contract, getting regulatory approval, building institutional capacities, linking Indian insurers with the international reinsurance market, preparing commodity exchanges for weather trading, advising the government on insurance subsidy, and developing low-cost technology to bring down administration expenses. The efforts of WRMS has enabled over 250,000 farmers across the country to access coverage under its various agriculture risk management services.
Project Summary
- Project name: Comprehensive agriculture risk management solutions for farmers
- Project start date: July 2009
- Duration: 2 years
- Country: India
Beneficiaries
The project targets farmers and their families in the regions of Howrah and Kamrup, covering about 250 000 hectares and offering coverage to more 50 000 farmers over the 2-year project period. Most of the farmers are involved in small-scale agriculture (< 1 hectare of land) and traditionally grow potatoes and rice paddy.
Project Description
The project seeks to help farmers undertake optimal agricultural activities and generate sustainable income by minimizing the weather shocks they face through financial and technological risk management measures. The program involves the installation of Automated Weather Stations (AWS) to collect and disseminate weather data and facilitate the settlement of weather insurance claims.
It will implement weather and hybrid insurance products to address the critical risk-management needs of the farmers. The project will also provide weather forecasts and warnings to help farmers take proactive steps to minimize possible crop loses due to adverse weather conditions. Eventually, the project aims to raise awareness about agriculture risk and insurance solutions amongst farmers by training and equipping various intermediary organizations working in the region.
Key Challenges
- Generating quality forecasts that can help farmers minimize the potential losses due to weather adversity
- Ensuring and enlarging the support of delivery channels to communicate the product specifications to the target group
- Demonstrating weather insurance effectiveness in minimizing credit risks and encouraging financial services providers
to provide credit to farmers in the region
Learning Agenda
- How does the Comprehensive Agriculture Risk program affect small-scale agriculture production
(access to credit, productivity, agriculture practices, attitude to risk)?
- What determines demand for index insurance by small farmers and how it can be stimulated?
- How to make index insurance commercially viable?
- What is an optimal contract that limits basis risk?
More information on the project
Website of the grantee:
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