MR Microinsurance_2012_03_29.indd - International Labour ...

Microinsurance and climate change
Table 4.2 Possible eff ects of climate change in classes of insurance, 2030–2050
Insurance class Possible eff ects 2030 2050
Agriculture Rapid-onset (weather catastrophes) +/++ +++
Slow-onset (temperature changes) +/++ +++
Frost – – –
Health Rapid-onset (weather catastrophes) o/+ o/+/++
Slow-onset (temperature changes) o/+ o/+/++
Health patterns, expanding disease ranges o/+ o/+/++
Life/Funeral Rapid-onset (weather catastrophes) + +
Slow-onset (temperature changes) o/+ +
Property Rapid-onset +/++ ++
+/++/+++ increasing risk
o neutral
–/– – –/– – –/– – – – decreasing risk
Source: Adapted from Munich Re Foundation, 2011.
4.2 Microinsurance and weather events
4.2.1 Brief history of “climate microinsurance”
Climate change has a major impact on weather conditions – weather being the
present state of the temperature, humidity, rainfall and wind, while climate is the
state of these weather elements over time. Consequently, most microinsurance
experiences that are relevant in the context of climate change are protection
against the occurrence of specifi c weather conditions, typically measured by some
sort of index.
Weather-index or parametric insurance has been developed in the context of
microinsurance since the beginning of the 21st century. Th e fi rst known example
was introduced in Mexico in 2001 to provide drought cover for farmers. Since
then, several covers have been introduced in Asia, beginning with a rain-based
index insurance in India in 2003 (see Box 4.1 and section 20.2) and a livestock
insurance in Mongolia in 2006 (see Box 12.3). In Africa, drought insurance was
introduced in Malawi in 2005 (see Box 4.2) and Ethiopia in 2006. Th ese covers
were subsequently adjusted or further developed, and new ones were added (e.g.
HARITA in Ethiopia in 2008, see Box 4.3).
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