International Finance Corporation (IFC), a member of the World Bank Group, and Swiss Re Corporate Solutions are to join forces to develop new and innovative index-based insurance products to help ease the impact of weather and natural disasters in developing countries. The products will be particularly targeted at farmers and the agricultural communities in Africa and emerging markets.
Swiss Re are making a big commitment to the microinsurance and weather index insurance sector at the moment, only yesterday we wrote about their new partnership with the World Food Programme in Ethiopia. Swiss Re’s substantial experience in creating innovative risk transfer and insurance solutions makes them an ideal partner for these initiatives.
This particular initiative will involve the creation of new products through the IFC’s Global Index Insurance Facility (GIIF). The GIIF develops products and markets for index-based insurance in developing markets. The products it develops are all triggered according to measured conditions on an index and claims are paid promptly in a manner that is much easier for the end-users to understand than traditional insurance methods.
“Innovative insurance products offer small farmers the tools they need to manage risks from unforeseeable events, giving them the certainty they need to grow their operations,” said Lars Thunell, IFC Executive Vice President and CEO. “Our partnership with Swiss Re Corporate Solutions will help us develop affordable new types of index-based insurance.”
Under the new partnership agreement Swiss Re will provide technical services to the GIIF and support its strategic objectives using its experience in developing innovative risk transfer tools.
“Supporting developing countries to become more resilient to major risks is a key objective for our company,” said Michel Liès, Chairman of Global Partnerships for Swiss Re. “Given the lack of efficient local insurance markets, partnerships with multilateral organizations like IFC play a central role in meeting this objective.”