Mobile-Enabled Microinsurance for Climate Resilient Agriculture | Climate Finance, Uganda 2018
SEED Practitioner Labs Climate Finance in Uganda engaged financial institutions, funders, intermediaries and other SME ecosystem stakeholders over a multi-step process to co-create innovative climate finance products and mechanisms that extend access to long-term financing opportunities for “missing middle” small and growing climate-smart enterprises that struggle to advance beyond the start-up stage and multiply their contributions to climate-smart and socially inclusive economies.
The mobile-enabled microinsurance solution developed by Financial Sector Deepening Uganda (FSDU) with UK Aid catalyses mobile-based technology to increase access to and improve the quality of agriculture insurance solutions offered to small-scale agribusinesses in Uganda. Real-time risk management and efficient pay-outs are major challenges to existing agriculture insurances. This is complicated by a lack of public awareness of the purpose of agriculture insurance and the wide geographical spread of agribusinesses across Uganda. The mobile-enabled microinsurance product insures small-scale agribusinesses who produce commercial crops against production losses, monitored using real-time weather indexing. Product delivery, servicing and claims pay-outs are facilitated by a network of insurance agents supported by local-level representatives and mobile-money and communication technology. This innovative insurance product will:
- Extend the market penetration of agriculture insurance among small-scale agribusinesses across key commercial crop value chains;
- Leverage mobile-based technology to inform and deliver insurance solutions to remote areas while allowing flexible consultation and pay-outs; and,
- Increase investment in commercial crops and climate-smart agriculture by freeing up capital previously spent on rebuilding from weather-related losses.