I4 Index Insurance Innovation Initiative
Announcements
Request for Proposals
The request for research proposals for the BASIS Assets and Market Access Research Program is now closed. Questions may be directed to the BASIS AMA CRSP office (basis@ucdavis.edu or 530.752.7252).
2012 Technical Meeting: Agenda, Papers, and Presentations
All materials from the recent I4 Technical Meeting held on June 13 and 14 are available under the events page.
I4 Brief
The third brief in the I4 Brief Series, Coping With Drought: Assessing the Impacts of Livestock Insurance in Kenya, is now available. The brief is authored by Michael Carter and Sarah Janzen.
Payout in Kenya for Index-Based Livestock Insurance (IBLI)
Against the backdrop of the drought in the Horn of Africa, the Kenya IBLI project has announced a payout. The formal announcement details the payout to hundreds of herders in the Marsabit region of Kenya where herd losses are estimated at one third from the current drought. For more information on the Kenya IBLI project, visit the Kenya IBLI page.
I4 Brief
The second brief in the I4 Brief Series, The IBLI Color Legend: Translating Index-Based Mortality Predictions into Meaningful Signals, is now available. The brief highlights a recent innovation in communicating payout expectations in the Kenya project and is authored by Michael R. Carter, Elizabeth Long and Andrew Mude.
BASIS, the United States Agency for International Development, the Food and Agriculture Organization of the United Nations, the Micro-Insurance Innovation Facility of the International Labour Organization, and Oxfam America announce the creation of the Index Insurance Innovation Initiative (I4). This initiative is a response to the overwhelming evidence that uninsured risk can drive people into poverty and destitution, especially those in low-wealth agricultural and pastoralist households. Risk can cause people to shy away from high-return activities or pursue defensive savings strategies that cut off sustained accumulation of productive assets. Risk also inhibits the development of rural financial market, which reinforces risk's negative impacts.
Finding ways to deal with risk and thus reduce poverty has long been a goal of development policy. I4 is developing a global action plan to reduce risk and poverty among small-scale agricultural and pastoralist households. While there is ample theory to show that index insurance can alter poverty dynamics, there is still much to learn about its effectiveness in practice. To rigorously test the hypothesis that by removing correlated risk from smallholder agricultural and pastoral systems we can reduce poverty and deepen financial markets in agricultural areas, the I4 team will design and implement a new generation of livelihood-optimized index insurance contracts. Potential impacts include improving technology uptake by farmers, thus increasing their incomes, attracting lenders into rural markets, and reversing the dynamics that create destitute families, thus reducing the massive costs of direct aid programs.
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