Quality Standards and the Role of Earth Observation in Improving Index Insurance Design
Abstract
Earth observation technologies have an increasingly important role in detecting adverse weather events and protecting people against their impacts. As one example, index insurance programs rely on a predetermined, objective indicator of losses to disburse relief payments. In practice, well-designed index insurance has demonstrated the ability to help people manage risk and move away from costly coping strategies such as skipping meals, withdrawing children from school, or selling off assets critical to generating income.
Unfortunately, too many examples exist of poorly designed index insurance products -- often based on simple rainfall indices or other input measures -- that fail to protect people in their times of need. Furthermore, since the quality of an index insurance contract cannot be immediately discerned by the consumer, failure-prone "bad" contracts can contaminate perceptions of the idea and drive out good contracts. In response to these concerns that have real implications on the lives and livelihoods of vulnerable people, we have begun developing quality standards for index insurance focused on improving farmer welfare and stimulating the market for high quality insurance. Our presentation will review essential elements of these quality standards as well as discuss the role of remote sensing science in improving how well index insurance products can protect people in practice.- Publication:
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AGU Fall Meeting Abstracts
- Pub Date:
- December 2019
- Bibcode:
- 2019AGUFMGC34C..04C
- Keywords:
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- 0230 Impacts of climate change: human health;
- GEOHEALTH;
- 1630 Impacts of global change;
- GLOBAL CHANGE;
- 1640 Remote sensing;
- GLOBAL CHANGE;
- 6309 Decision making under uncertainty;
- POLICY SCIENCES & PUBLIC ISSUES