Sunny times for weather insurance

It’s not all been easy. But our weather insurance programs in Bangladesh have grown much faster than expected. They continue to expand by the day. 

“We want to transform the agricultural microinsurance market in Bangladesh”, explains our Country Director Farhad Zamil. The Foundation’s bid to do so started in 2018 with just 171 smallholders investing in potato insurance. Four years in, almost 416,000 farmers have taken outcrop policies. 29% of the insured are women.

Together with partners, we are implementing two agricultural insurance initiatives in Bangladesh. Crop Surokkha promotes risk-mitigation measures for climate change adaptation. Funding comes from the Swiss Embassy in Bangladesh, with Swisscontact providing project management. The other initiative, ‘Boosting Agriculture Risk Mitigation through Climate Insurance for Smallholders’ is funded by the InsuResilience Solutions Fund. 

“Our team works with Green Delta Insurance Company and the public Sadharan Bima Corporation on Weather Index-Based Insurance (WII) products”, explains says our local Program Lead, Aminul Moven. “All the WII is carefully designed to be relevant and affordable for smallholders.” The program partners set out to cover common weather risks for Aman and Boro rice, maize (corn), potato, and vegetables. “Together, we developed 20 WII products”, Moven continues. “We piloted 17 of them, working with distribution partners from the finance and agro sectors. They made the crop insurance available to farmers at more than 2100 points of sale.”  

Growth has been rapid, which has required some adjustments. Crop Surokkha initially targeted 16 sub-districts in ten districts; the insurance is now available in 64 sub-districts of 16 districts. “We started off with a goal of serving 233,000 smallholders”, adds Moven. “Already more than 340,00 have chosen to insure their crops, and the number continues to grow.” 

“As in other countries, this isn’t just about a simple sales transaction”, comments Olga Speckhardt, who leads our Foundation’s Global Insurance Solutions. “Education is also crucial. Our Bangladesh team is engaged in a huge awareness campaign.”  Aminul Moven and colleagues explain insurance to smallholders through numerous channels. These include farmers’ financial literacy meetings, leaflets, videos, and TV.

As well as education, the insurance initiatives also provide weather forecasts and agricultural advice via mobile phone.  “We calculate that over a million farmers have had access to the education, more than one-third of them female”, reports Moven. “We originally aimed for 780,000 smallholders.” The weather forecasts and farming advice have also proved popular. More than 300,000 insured farmers have made use of these services, which help them produce more efficiently. 

“Getting to these great results hasn’t all been easy, however”, comments Country Director Farhad Zamil.  “Initially, smallholders were very reluctant to buy policies because they mistrusted insurance”. Clear information from the various distributors helped change farmers’ opinions entirely. “Our distribution partners have also discovered the monetary and social value of including crop insurance in their existing product offers.” Based on the successes so far, our Bangladesh team and partners believe that a million insured smallholders could soon be possible.