Sometimes new products appear on the market which are both innovative and interesting to us here at Artemis. This one is particularly interesting as it utilises satellites to assess pasture greenness to create an index against which insurance products can be triggered.
The micro-insurance project in question is in Kenya where the International Livestock Research Institute and a team of American university researchers have devised a pilot for a livestock insurance product to protect herdsmen from the losses of animals experienced due to drought.
Rather than having to verify claims in the normal manner with insurance for livestock, this pilot uses an index which allows claims to be verified instantly and payouts to be made much more quickly.
This merging of micro-finance with alternative risk transfer techniques is becoming more and more prevalent and is both helping the developing world as well as providing new product opportunities for insurers and others who underwrite the programs often through the use of derivatives.
Read more about this on the BBC website.
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