International reinsurance broker Guy Carpenter & Co. announced that it will receive a $1.0 million grant from the International Finance Corporation (IFC), a member of the World Bank Group.
The grant will be used to help “develop a market for weather, index-based microinsurance in order to benefit farmers in Mozambique, where the majority of the population depends directly on agriculture for economic subsistence,” Guy Carp explained.
The project will be jointly carried out by Guy Carpenter in collaboration with Risk Management Solutions (RMS). The two will take on the task of designing and implementing “new and affordable index-based insurance products for flood and drought risks.”
RMS will work on the “risk modeling and risk quantification metrics necessary to transparently price the risk for products that minimize operational costs and thereby facilitate activation of the program.”
Guy Carp takes on the job of “developing the local market and capacity needed to support weather index insurance and on scaling agricultural index insurance into a commercially viable and sustainable product.”
Alex Bernhardt, Guy Carpenter’s Head of GC Micro Risk SolutionsSM, explained that giving the farmers in Mozambique access to insurance will help enable them to “protect themselves from potentially devastating flood- and drought-related losses and assist them in accessing the capital they need to invest in inputs and production to improve crop yield and food security.”
Dr. Pane Stojanovski, RMS VP of Model Development Operations, noted that the “devastating catastrophic events worldwide in 2010 highlighted that building effective and efficient catastrophic risk management solutions that benefit the poor is vital for sustainable economic development.
“A crucial barrier to deploying such solutions is a lack of data and analytical expertise in areas with significant catastrophic exposures and large vulnerable populations at risk, such as Mozambique,” he added. “RMS is committed to filling this gap in the international development marketplace, which will in turn help to protect the livelihoods of the disadvantaged.”
Source: Guy Carpenter & Company
Was this article valuable?
Here are more articles you may enjoy.