In close cooperation with Allianz Re and the Swiss agency SDC, “Deutsche Gesellschaft für Internationale Zusammenarbeit” (GIZ) has developed a new concept for crop insurances that will initially be available in seven countries in Asia. The scheme features the monitoring of cropland via remote sensing with satellites.
In future, insurances will be provided to protect more than five million smallholders and their families in Asia from being ruined by failed harvests. Initially, the insurance policies are to be offered in seven countries. In Bangladesh, Cambodia, India, Indonesia, Thailand, the Philippines and Vietnam, smallholders will enjoy more economic security. As “Deutsche Gesellschaft für Internationale Zusammenarbeit” (GIZ) announced in March, the organisation has been commissioned by the German Federal Ministry for Economic Cooperation and Development (BMZ) to work together closely with the Swiss Agency for Development and Cooperation (SDC) and “Allianz Rückversicherung” (Allianz Re) to establish a crop insurance scheme. Collaboration has initially been agreed for a period of three years.
So far, the introduction of crop insurance schemes has proved to be very difficult since it has not been possible to provide accurate data on crop failures and the reasons for them; this applies in particular to the remote rural regions of poor countries. State-of-the-art satellite technology as well as new growth models can now make accurate data available enabling exact estimates of the harvest volume. Such estimates then serve as a basis for the calculation of the level of damage and hence the compensation amount in the event of a partial crop loss.
Presenting the new offer, Michael Roth, who is responsible for the development and introduction of the insurance scheme at GIZ, stresses just how much of a tightrope walk it is for GIZ and its partners: “On the one hand, the insurance policy has to be affordable for our potential clients. On the other, in the event that damage occurs, the compensation amount has to be genuine support preventing people from slipping into absolute poverty.”
In cooperating with the project partners, GIZ seeks to benefit from its decades of work in the countries involved in order to bring all stakeholders together. One important task here will be to develop the skills that the responsible staff in the project countries require. In addition, GIZ is going to support the authorisation of the insurance solutions by the responsible state authorities and provide the population with comprehensive information on the insurance solutions.
In the second phase of the project, insurance solutions are to be offered in other Asian countries, but also in Africa and South America. In addition to GIZ, Allianz Re and SDC, the Swiss Earth observation company sarmap and the International Rice Research Institute (IRRI) are involved in the project.