Blue Marble renews, expands Colombia parametric weather insurance

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Blue Marble Microinsurance (Blue Marble) said it has renewed and expanded the weather index insurance scheme for smallholder coffee farmers in Colombia that it launched in 2018 in cooperation with Nespresso.

blue-marble-microinsuranceThe pair launched the program as a pilot scheme in late 2018, saying that because of climate change coffee producers in the region were becoming particularly exposed to weather variability and extremes.

As a result, risk transfer solutions to assist the coffee growers with livelhood protection were deemed part of the solution, which Blue Marble, backed by its shareholding global insurance, reinsurance and broking firms, was seeking to deliver on.

The pilot has clearly been deemed a success, as Blue Marble said today it is renewing the parametric weather index insurance program for smallholder coffee farmers in Colombia, with a significant expansion of coverage.

“Growing this program has been a collaborative effort,” commented Joan Lamm-Tennant, Chief Executive Officer of Blue Marble. “We are grateful for the support of our partners, including Nespresso, Caféxport and Seguros Bolivar. Together, we are reducing vulnerabilities in the lives of smallholder farmers.”

Dubbed the CaféSeguro program, the product provides tailor-made insurance coverage for severe rainfall and drought during the developmental stages of coffee crop growth, when it is most vulnerable to weather shocks.

The parametric insurance program now serves about 3,275 smallholder farmers, which is a 46% increase since a year ago.

New government subsidies for crop insurance have helped, making it easier for the smallholder farmers to access greater coverage and as a result most have seen their insurance coverage triple and their costs decrease as well, Blue Marble explained.

The program has experienced a 100% renewal rate as well, among existing cooperatives and also added one new cooperative, Alto Occidente, to the program.

In its first year, the CaféSeguro program covered 2,250 farmers belonging to the Aguadas, Norte de Caldas and Andes coffee cooperatives in Caldas, Colombia, with most of the farmers receiving an insurance payout in the first year after a severe drought impacted their crops.

“CaféSeguro is important to our coffee farmers because it protects them against adverse weather events,” explained Cesar Julio Díaz, President of the Aguadas, Norte de Caldas and Alto Occidente cooperatives. “It guarantees their continual agricultural activity while improving their livelihoods.”

Blue Marble said it plans to continue expanding the program in Colombia and will also explore new business models to serve additional smallholder farmers, while moving forward with plans to expand the program to cover other crops and countries.

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