Smallholder farmers are particularly vulnerable to climate change because they lack insurance to protect against crop and livestock loss. In addition to devastating floods, farmers in Pakistan report losses from drought and irregular weather patterns, and female farmers often face greater economic hurdles recovering from such losses.
Solution and Impact
A DFC loan is helping the InsuResilience Investment Fund work with financial institutions to develop and expand insurance to protect smallholder farmers and other climate-vulnerable populations against extreme weather and other natural disasters.
In Pakistan, InsuResilience partnered with a microfinance institution, the Kashf Foundation, to expand access to a livestock loan product that covers the cost of repayments if a cow becomes sick or dies. This coverage helps farmers avoid depleting savings or selling assets to cope with the loss.
Nadia Rubaa is one farmer who used the loan to purchase a cow and later, when the cow died, to make a claim for the loss. Without the loan, she says she would have needed a new source of income to support her family.
InsuResilience, a fund managed by BlueOrchard, aims to protect between 70 and 110 million of the most vulnerable people on the planet by 2025 by developing insurance products for smallholder farmers and micro, small, and medium enterprises. Expanded access to insurance can reduce losses and humanitarian impacts by enabling more rapid response and relief efforts.