Weather Index Insurance

It is a parametric insurance policy. It is a novel approach to evaluating agricultural risks whereby payouts are automatically triggered when certain weather conditions or indices have been reached. The level of indemnity is pre-agreed upfront for each index. This parametric approach aims to enhance traditional crop insurance products by leveraging on accurate historical and real-time satellites data from the European Centre for Medium-Range Weather Forecasts (ECMWF)

Claims Payout

Claims are automatically triggered based on the occurrence of the specific insured weather index (rainfall level). Consequently, the determination of a payout depends on data from a trusted source and not on the arbitrary assessment of an insurance assessor. Both the policyholder and the insurance company have access to a platform where each individual insurance policy can be monitored in real time. Therefore, policyholders are not required to notify us of a claim.

Weather Index vs Traditional Insurance Policies

Our parametric insurance is a weather index policy which covers a policyholder against the occurrence of specific weather events. Therefore, payouts are not determined by actual losses to crops on an insured’s farm. This allows for quicker and more objective claims settlement. Whereas traditional insurance policies are indemnity policies, whereby payouts are based on actual losses. This results in relatively more tedious and time consuming claims settlement processes.

Why You Need Weather Index Crop Insurance?

• LESS PAPERWORK AND EASIER CLAIMS PROCESSING:

  Our weather index insurance approach eliminates the need for complex claim processing. Insurance payouts are made faster and easier with the use of predefined parametric triggers.

• PROMPT PAYOUTS:

  This policy does not require onsite checks or evaluations. Therefore, payouts are made within 10 working days after a trigger in order to enable farmers not lose out completely within a farming season.

• TRANSPARENT TRANSACTIONS:

  our weather index insurance policy relies on weather data from the European Centre for Medium-Range Weather Forecasts (ECMWF) a trusted and credible source. As of 2021, the ECMWF's weather model is generally considered to be the most accurate weather forecasting model. This means that both the insurance company and the insured cannot manipulate this data. The data is publicly available and auditable. Additionally, policyholders can monitor the performance of their policies in real time.

• DECREASED BASIS RISK:

  This is the occurrence whereby a farmer's actual losses differ from the index used to determine the payout. Even though no index insurance policy can't totally eliminate this, our weather index insurance policy has been designed to minimize this risk by the use of local weather trends and crop production as well as satellite weather data and not weather stations.