Delhi announces the decision at Climate Week NYC with a comprehensive set of commitments aimed at enhancing climate resilience while fostering sustainable development.
Nepal: Protecting farmers with flood insurance
Implementer: Practical Action, Stonestep TFD Pvt. Ltd., Global Parametrics Ltd., Shikhar Insurance Co Ltd., InsuResilience Solutions Fund (ISF)
Country & Region: Nepal, Asia
Impact System: Human Settlements / Finance
Beneficiaries / Impact: 267,000 beneficiaries by 2025
In the majestic shadows of the Himalayas lies Nepal, a country known for its breathtaking landscapes and rich cultural tapestry. But behind this beauty lies a pressing challenge: the persistent threat of natural disasters, particularly floods, which pose a grave risk to the nation’s farming community. To combat this, a coalition of organizations has embarked on a mission to shield these farmers with an innovative solution – index-based flood insurance. This initiative, grounded in collaboration and innovation, promises not only financial relief but also the hope of a more resilient future for Nepal’s agrarian heart.
Nepal’s farmers, who form the backbone of the nation, face many challenges, especially from natural disasters like floods, landslides, and windstorms. These calamities put their crops and livelihoods at risk. A group led by Practical Action is stepping in with a new solution: a specially designed flood insurance for the farmers living in flood-prone regions, mainly in western Nepal.
Understanding Nepal’s vulnerability
Nepal, sandwiched between India and China in the Himalayas, has unique geographical features that make it prone to floods. The situation is worsening due to climate change. Significant portions of the population, over 65%, rely heavily on agriculture. Unfortunately, floods are frequent and can wreak havoc on their livelihoods. The goal is clear: find ways to help these communities withstand and recover from these disasters.
Introducing the insurance solution:
Local community-focused institutions, like microfinance groups and cooperatives, are central to this plan. They buy the flood insurance on behalf of their farmer members. This insurance has two main benefits:
- Immediate Payouts: When severe floods occur, the insurance uses specific measurements (like river flow rates) to determine payouts. This method speeds up the process, allowing farmers to get help faster.
- Educational Component: This insurance isn’t just about payouts; it also provides farming advice to help farmers mitigate losses.
Roadblocks and solutions:
Every solution faces challenges, and this one is no exception:
- Data Shortages: Some regions lack detailed flood data. To address this, the project currently focuses on areas with sufficient data. Meanwhile, the team collaborates with Nepal’s meteorological department to expand data collection.
- Awareness: Introducing new insurance concepts requires education. The team is working hard to educate farmers about the benefits and workings of this insurance, ensuring they can make informed decisions.
Index-Based Flood Insurance (IBFI) is a simple, easy, and innovative way of risk transfer – as smallholder farmers will access their insured amount as soon as the indexes are met and soon after the flood crosses the pre-defined threshold. In this regard, IBFI is revolutionary in the insurance sector and many smallholder farmers are attracted to this scheme. Since cooperatives from the communities are policyholders on behalf of farmers, they trust the insurance scheme and have a positive outlook towards it.” – Dhundi Raj Rijal, Branch Manager, Shikhar Insurance Bardiya
- Main Threat: Floods
- Solution: Tailored flood insurance for farmers
- Objective: Strengthen farmer resilience against floods in Lower Karnali, Nepal
- Direct Beneficiaries: Farmers and their families, with a goal to reach 267,000 by 2025
- Project Duration: March 2021 to March 2023
- Nature of Initiative: Proactive preparation and immediate relief
For more details, read the original story by Insuresilience
Medellín, Colombia, joins forces with Race to Resilience partners to combat climate change risks through innovative insurance solutions. Discover how parametric insurance is revolutionizing disaster risk management in the face of climate change.
Led by Race to Resilience partner, ICIS, the East Side Coastal Resiliency (ESCR) Project is a coastal protection initiative aimed at reducing flood risk due to coastal storms and sea level rise on Manhattan’s East Side.
Partner: DARAJA, Resurgence Implementers: Kounkuey Design Initiative (KDI) in Nairobi, the Centre for Community Initiatives (CCI) in Dar es Salaam, Resurgence, the Kenya Meteorological Department (KMD), the Tanzania Meteorological Authority (TMA) and array of key local community partners and leaders. Country & Region:Kenya, Tanzania, Ethiopia, Sudan and Uganda – Africa Impact System: Human Settlements /Early Warning Systems […]