Insurtech Blue Marble Launches Weather-Index Crop Insurance for Pakistani Farmers

Blue Marble, a London-based insurtech that offers affordable insurance protection for low-income families and small businesses in emerging markets, has launched a weather-index insurance-pilot program for smallholder farmers in rural Pakistan.

The pilot program, which will cover 500 farmers, is organized in partnership with Asia Insurance, a local insurer, and Reap Agro, a Pakistan-based microfinance organization that specializes in lending to smallholder farmers.

Using Blue Marble’s proprietary AgSuite platform, the program will provide tailored, parametric insurance coverage against excessive rainfall, droughts and other natural disasters. Payouts are automatically triggered to policyholders based on a pre-defined index that measures the magnitude of the event, providing farmers with quick access to vital funds in their time of need while avoiding costly claims assessments.

Asia Insurance will serve as the underwriters for the program and will work directly with Reap Agro to enroll eligible customers. Reap Agro key agricultural inputs such as fertilizer, seeds and pesticide and advises farmers on best practices throughout the season.

“Farmers in Pakistan are among the populations most vulnerable to climate change but lack access to affordable crop insurance to protect against severe weather events,” said Tughral Ali, head of Asia Pacific for Blue Marble. “We are proud to launch this pilot program in collaboration with our partners in order to create a sophisticated but cost-effective safety net for farmers and their families.”

Zain ul-Haq Qureshi, CEO of Asia Insurance, commented: “Developing cutting edge agriculture insurance products is a key focus area for Asia Insurance. We see weather index insurance as a superior solution for addressing farmers’ needs while also providing better coverage to agri lenders than is presently available in the market.”

While traditional agricultural insurance products require heavy documentation with long processing and payout times, weather index insurance provides quick payout, said Ehtisham Ali, CEO of Reap Agro, noting that the Blue Marble solution “will revolutionize the agri insurance landscape in the country and provide real protection to farmers.”

Research has found that the effects of climate change have a disproportionate impact on developing nations, said Blue Marble, noting, however, that a number of barriers have prevented insurers from offering better protection in emerging markets.

These barriers include a lack of access to products and services, a lack of affordable solutions, low awareness among local populations and inadequate products.

According to the Global Climate Risk Index, Pakistan ranked fifth among nations most susceptible to climate change, with nearly 10,000 lives lost and economic damages worth $3.8 billion incurred between 1998 and 2018. In Pakistan, smallholder farmers comprise 60% of the country’s 8.2 million farmers and until the pilot program have not had access to parametric insurance. As a result, they often fall prey to loan sharks and become entrapped in a perpetual cycle of debt and poverty, said Blue Marble.

About Blue Marble

Blue Marble, which is the brand name for Blue Marble Micro Ltd. and its operating subsidiaries, works with local insurance companies to deliver affordable insurance protection programs to benefit low-income families and small businesses in emerging markets. Leveraging its proprietary technology, Blue Marble aims to fill the protection gap for populations most vulnerable to the devastating impact of weather and health related catastrophes by delivering tailored, affordable insurance solutions.

Blue Marble is owned by a consortium of multinational insurance entities, including Aspen Insurance, Grupo ASSA, Marsh McLennan, TransRe and Zurich Insurance.

Photo credit: Huzaifa Waheed in Karachi, Pakistan

Topics InsurTech Tech Agribusiness