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Climate change and persistent underdevelopment are global challenges. This issue of Climate and Society examines the use of index insurance to help reduce vulnerability and poverty and adapt to climate change. Experience to-date has been limited to individual case studies, which show promise of lessening the impacts of climate shocks and enabling investment and growth in the agriculture sector. But these case studies have also uncovered significant questions that must be answered in order to start implementing index insurance at a scale relevant to attaining meaningful development impacts. The publication process was kicked off at a high level roundtable event, co hosted by the IRI and Swiss Re, in cooperation with the Global Humanitarian Forum.
Climate and Society No. 2
Climate and Society No. 2 takes a fresh look at the effectiveness of index insurance for reducing poverty and better managing climate risk. Case studies and pilot programs show that index insurance can effectively target a range of critical climate/poverty issues – from national-level food insecurity response to farm-level credit availability. These projects show great promise. They also have uncovered significant questions, that, if ignored during implementation, could lead to failure and even increase overall vulnerability. Climate and Society No. 2 captures these questions, examining current case studies, relying on expert scientific opinion to delineate the advances, opportunities, pitfalls and limitations faced in scaling up index insurance. In particular, the following questions are examined:
- How should index insurance be targeted to have the greatest impact on poverty?
- What are the hurdles to scale-up, and how can they be managed? Can climate science and information help overcome hurdles associated with climate change and basis risk?
- What are the roles of governments, NGOs and donors in scaling up index insurance for poverty reduction?