Advances in modeling and sensors can help farmers and insurers manage risk
Insurance Daily News
News Reporter-Staff News Editor at
Insurance Daily News When drought caused devastating crop losses in
Malawi in 2015-2016, farmers in the southeastern African nation did not initially fear for the worst: the government had purchased insurance for such a calamity. But millions of farmers remained unpaid for months because the insurer’s model failed to detect the extent of the losses, and a subsequent model audit moved slowly. Quicker payments would have greatly reduced the shockwaves that rippled across the landlocked country.
While the insurers fixed the issues resulting in that error, the incident remains a cautionary tale about the potential failures of agricultural index insurance, which seeks to help protect the livelihoods of millions of smallholder farmers across the globe. Recent advances in crop modeling and remote sensing - especially in the availability and use of hig
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IMAGE: A trial of drought-tolerant beans in 2016 in Malawi, during one of the worst droughts to hit the nation in three decades. view more
Credit: Neil Palmer/International Center for Tropical Agriculture
When drought caused devastating crop losses in Malawi in 2015-2016, farmers in the southeastern African nation did not initially fear for the worst: the government had purchased insurance for such a calamity. But millions of farmers remained unpaid for months because the insurer s model failed to detect the extent of the losses, and a subsequent model audit moved slowly. Quicker payments would have greatly reduced the shockwaves that rippled across the landlocked country.