Contents -- Abstract -- Acknowledgments -- 1. Introduction -- Income Transfer versus Insurance Functions -- Indexing as a Social Protection Instrument -- Study Purpose and Structure -- 2. Index-Based Insurance in Low-income Contexts: Potential and Limitations -- Why Insurance is Important -- Reasons for Undersupply of Insurance -- Weather-Index Based Insurance -- Implications for Public Intervention -- 3. Recent Global Innovations -- Mongolia Index-Based Livestock Insurance -- Mexico FONDEN and FAPRACC -- India: Supporting Commercially Provided Weather Indexed Insurance -- 4. Forays into Insurance in Africa -- Ethiopia WFP and International Drought Insurance -- Malawi: Using Rainfall Data for Both Localized Crop Specific Insurance and for a National Index of Maize -- Kenya Arid Lands Livestock -- Programs in the Planning Stage: Madagascar and Tanzania -- 5. Future Directions and Conclusions -- Public Investment and Weather-Indexed Insurance Market Failures -- Improving the Information Base in African Countries -- Applying Weather-Indexing to Social Protection Programs -- Potential Role of the World Bank in Insurance-Based Social Protection -- Appendix -- Bibliography -- List of Table -- 1. Payout Schedule for Malawi Groundnut Insurance -- List of Figure -- 1. MMPI Historical Insurance Payouts & WFP Food-aid Drought Deliveries -- List of Boxes -- 1. Micro Finance Institutions Purveyors of Micro-Insurance -- 2. Considering Alternative Approaches to Livestock Risk Management -- 3. Potential Uses for Rainfall Insurance in Ethiopia -- 4. Mongolia-Contingent Debt Facility in an IDA Index-Based Insurance Project.

Uninsured risk had far-reaching consequences for rural growth as well as poverty reduction. A range of informal mechanisms to insure rural households against the impact of shocks, but they are a modest component of a risk layering strategy for well-off households and even less protective for low-income households. Formal insurance mechanisms have inherent market imperfections. State interventions to address these limitations have proven costly and generally are targeted poorly. Recent developments in microfinance as well as in insurance marketing have opened new possibilities for household risk reduction. Index insurance, such as weather indexing, addresses other inherent problems in insurance by using an indicator that is not affected by individual behaviour and may address monitoring costs and moral hazard. A number of innovations using index insurance are being tried currently in diverse settings ranging from India to Mongolia to Malawi. Marketing costs may limit the provision of such insurance to small farmers, but even in such cases microfinance institutes may serve as market intermediaries. Moreover, state and submational governments can use insurance to achieve countercyclical funding programs. In this vein, municipal governments in Mexico have used insurance to finance disaster contingency while the World Food Program has insured a portion of its emergency assistance to Ethiopia. Humanitarian organizations and NGOs may also seek insurance in this manner.

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Electronic reproduction. Ann Arbor, Michigan : ProQuest Ebook Central, 2018. Available via World Wide Web. Access may be limited to ProQuest Ebook Central affiliated libraries.