ADA Shares Lessons Learned on Insuring Agricultural Producers Against Climate Risks

ADA Shares Lessons Learned on Insuring Agricultural Producers Against Climate Risks

InFiNe member ADA has published new insights on index-based agricultural insurance, an innovative solution for protecting small producers against intensifying climate hazards.

As droughts, floods, and other climate-related risks increase, index-based agricultural insurance offers a promising approach by compensating farmers whenever an objective weather indicator—such as rainfall or temperature—crosses a set threshold, without requiring on-the-ground damage assessments.
ADA recently completed capitalization work on seven projects in West Africa implemented in collaboration with local partners. The aim was to strengthen expertise in inclusive agricultural insurance and integrate the most effective solutions to support agricultural value chains.

Key lessons from the work include:
Combined solutions bring more value to producers. Bundling insurance with other essential services, such as access to agricultural inputs and credit, better meets producers’ needs and increases their interest in the product.
Trust hinges on close and varied distributors. Involving local players—such as microfinance institutions and community leaders—in distribution helps reach more producers, strengthens trust, and facilitates uptake of insurance solutions.
Continuous adaptation is key to sustainability. Insurance products must evolve regularly based on feedback from customers and stakeholders to ensure long-term impact and commitment from all involved parties.

One highlighted example is ADA’s support to OKO, an insurtech operating in Mali, which distributes index-based agricultural insurance via mobile phone to small corn producers. Following a satisfaction survey, OKO improved its services by implementing clearer oral communication tools, including a call center and voice messages in the local language on WhatsApp.

Read the full publication to discover more lessons learned by ADA and its partners in building climate resilience for agricultural producers.

Source(s): ADA News

Photo(s) © ADA