New Satellite Applications in Agricultural Insurance
How can satellite technology reduce the cost and improve the quality of agricultural insurance? CGAP and agricultural insurance company Pula participated in a discussion hosted by the World Bank's Agrifinance Community of Practice, about our work to make area yield index insurance affordable for African farmers.
Presenters discussed the early performance of a new algorithm that uses satellite imagery and farm-level yield data to drastically reduce the amount of crop sampling required to offer area yield index insurance products. By freeing providers from their reliance on labor-intensive measurements to determine average yields in remote areas, the algorithm stands to greatly reduce delivery costs and simplify the logistics required for rolling out agricultural insurance at scale -- even in the hardest-to-reach communities.
The presentation covered CGAP's and Pula's methodology along with key partnership strategies used to source accurate data and validate the algorithm in Nigeria and Kenya. Client-centric on-boarding strategies were also discussed.
Rose Goslinga is the managing director of Pula, a company that is radically restructuring agricultural insurance, using technology to increase and protect the incomes and yields of billion smallholders worldwide. Pula works in eight countries across Africa and Asia and in 2017 alone facilitated crop and livestock insurance cover to 600,000 farmers in Kenya, Rwanda, Uganda, Nigeria, Ethiopia, India, Zambia, Tanzania and Malawi. Its founders' work in agriculture insurance has been recognized by several international awards, including the Financial Times/IFC Award for Sustainable Finance.
Emilio Hernandez leads CGAP's work on financial innovation for smallholder families. He provides technical guidance to better understand the financial behavior of smallholders and explore innovative strategies, processes and products to adequately serve this large clientele segment. Prior to CGAP, Emilio led technical cooperation programs focused on inclusive rural and agricultural finance at the Food and Agriculture Organization, overseeing field interventions in Latin America, Africa and Asia. He also oversaw business operations for a large international agricultural technology company throughout Central America.
Victor Wang attends the University of Toronto, majoring in Actuarial Science and Economics, and is currently pursuing his actuarial accreditation. He is currently working on Pula's analytics and data science team, supporting projects in multiple countries related to yield based insurance and livestock product offerings. He has previously worked at Intact Financial Corporation as an actuarial analyst working on the regional pricing team as well as at Cigna Corporation as an actuary working on Obamacare.