Swiss Re Policies Help Cholera Victims in Haiti, Poor Farmers in Africa

Tuesday, September 27, 2011

Global reinsurer Swiss Re is introducing business interruption coverage in case of cholera outbreaks for women entrepreneurs in Haiti.

Swiss Re, together with Mercy Corps and Fonkoze, the largest microfinance organization in Haiti, are introducing a new cholera insurance program. The coverage ensures rapid payout once a pre-defined set of criteria are met. These include cholera-related hospital admissions and observable weather factors linked to cholera outbreaks. Cholera first appeared in Haiti after the heavy rains in the fall of 2010.

These parametric policies use a specially developed index to closely mirror actual local situations. They are efficient since they can provide funds even while policy holders wait for medical checkups or other assessments. The scheme is expected to make cholera covers available to Fonkoze’s women borrowers (which currently number 50,000) and their families, and be fully implemented by 2013.

The cholera insurance program builds on the group’s existing product in Haiti, a natural catastrophe microinsurance cover launched in early 2011 and that provides protection to Fonkoze’s women clients against loss of livelihood caused by earthquakes, floods and hurricanes.

Some 4,000 women who lost their homes or business assets in the floods earlier this year have already received $1 million in payment, according to Swiss Re. The reinsurer says it expects this cholera policy will be similarly effective in ensuring that the infection of an income provider does not result in destitution for the entire family. The index Swiss Re is developing for programs in Haiti can potentially be applied to other infectious diseases in other parts of the world, the company said.

Source: Insurance Journal (link opens in a new window)