New-concept flood insurance could help Bangladesh’s poor

Monday, April 14, 2014

A new insurance scheme in which pre-determined flood thresholds trigger speedy compensation offers hope for poor people in flood-prone Bangladesh, experts say.

“Floods adversely impact the ability of the poor to earn a livelihood both by destroying assets and limiting opportunities for labour,” said Snehal Soneji, Oxfam International’s Bangladesh country director.

“This [insurance] product is index-based and operates at the meso-level, which means that payout is triggered on the basis of a certain threshold being reached resulting in immediate payout without the long process of surveying and then payout,” he explained, referring to traditional insurance schemes that rely on time-consuming damage assessment surveys to determine compensation.

Source: Irin News (link opens in a new window)

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microfinance, microinsurance, poverty alleviation