The InsuResilience Solutions Fund, which is part of the InsuResilience Global Partnership, will fund and support the development of an index-based crop and livestock insurance solution for smallholder farmers in South Africa.
It’s the first funding announced by the InsuResilience Solutions Fund (ISF), which was established and is funded by KfW, the German government-owned development bank, on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ) and began operations earlier this year.
The InsuResilience Solutions Fund (ISF), represented by its management the Frankfurt School of Finance and Management, South African Land Bank Insurance Company and parametric weather and climate insurance specialist Celsius Pro, will develop and launch the index-insurance product targeting provision of insurance cover to some 240,000 people by 2021.
Adam Maniki Rakgalakane, Managing Director of Land Bank Insurance Company, commented, “With the support of the InsuResilience Solution Fund we will develop a drought insurance solution for smallholder farmers, which will allow faster pay-outs and relief in case of a drought.”
South Africa has a disaster relief program, under its own Department of Agriculture, but as ex-post financing has often not been delivered rapidly enough it is thought a parametric insurance solution would be a good complement that can ensure more rapid distributions of capital to affected farmers.
CelsiusPro, the Swiss insurtech focused on climate, weather and natural catastrophe insurance on a parametric basis, will assist with the development of the insurance product.
Mark Rueegg, CEO of CelsiusPro, said, “We are proud to provide, an automated insurance administration platform enabling quick payouts, reducing costs and making insurance affordable for smallholder farmers. It is our aim to include poor and vulnerable people into the financial system.”
Dr. Annette Detken, Head of InsuResilience Solutions Fund, added, ”The project shows the way to concrete and scalable solutions improving resilience and adaptation to climate impacts.”