Recent Findings in Crop Insurance Described by Researchers from University of Rajshahi (Piloting a Weather-Index-Based Crop Insurance System in Bangladesh: Understanding the Challenges of Financial Instruments for Tackling Climate Risks)

Insurance Daily News

2021 AUG 19 (NewsRx) -- By a News Reporter-Staff News Editor at Insurance Daily News -- Investigators publish new report on crop insurance. According to news reporting originating from Rajshahi, Bangladesh, by NewsRx correspondents, research stated, “Bangladesh is one of the most vulnerable countries in the world to extreme climate events. With over 60% of its population living in rural areas, over a third of which lives under the poverty line and depends on agriculture, these climate stresses constitute a major challenge.”

Funders for this research include Belmont Forum-G8.

Our news reporters obtained a quote from the research from University of Rajshahi: “The traditional financial instruments, e.g., microcredit and relief programs, continue today. However, how climate risk can be tackled through innovative financial instruments focusing on agriculture farms and farmers is crucial. Considering this issue, the Sadharan Bima Corporation and the Bangladesh Meteorological Department joined forces in 2014 to launch a $2.5 million three-year pilot project on weather-index-based crop insurance (WIBCI) executed by the Financial Institutions Division of the Bangladesh government’s Ministry of Finance. This study examined the basic strategy of this pilot project, the major challenges confronted, and possible solutions for creating a successful weather-index-based crop insurance scheme in Bangladesh. We relied on key informant interviews, informal discussions, focus group discussions, and in-depth interviews with the major stakeholders of the WIBCI pilot. These showed the WIBCI pilot to be a promising initiative that still faces problems from limited weather data, a costly business operations system, farmer insurance illiteracy, and fatalism, as well as problems with designing insurance products and recruiting qualified personnel.”

According to the news editors, the research concluded: “We compared this WIBCI pilot against the challenges of other projects, recommending best practices for a viable weather-index-based crop insurance system. The insurance mechanism of this study may apply to other vegetation sectors of Bangladesh, e.g., forest plantation or agroforestry for protecting natural resources from natural disasters.”

For more information on this research see: Piloting a Weather-Index-Based Crop Insurance System in Bangladesh: Understanding the Challenges of Financial Instruments for Tackling Climate Risks. Sustainability, 2021,13(8616):8616. (Sustainability - http://www.mdpi.com/journal/sustainability). The publisher for Sustainability is MDPI AG.

A free version of this journal article is available at https://doi.org/10.3390/su13158616.

Our news journalists report that more information may be obtained by contacting Abdullah Al-Maruf, Department of Geography & Environmental Studies, University of Rajshahi, Rajshahi 6205, Bangladesh. Additional authors for this research include Sumyia Akter Mira, Tasnim Nazira Rida, Md Saifur Rahman, Pradip Kumar Sarker, J. Craig Jenkins.