Index insurance and climate risk: prospects for development and disaster management

Climate and Society publication series, no.2:

The publication critically examines 17 case studies of index insurance implementation, and the challenges and opportunities facing them if they are to contribute to development at meaningful scales.  It focuses on the potential of index insurance as a development, climate change adaptation and poverty reduction tool through improved climate risk management and transfer, aiming to bring state-of-the-art knowledge and practice on index insurance to a broader audience.

The publication examines two scales at which index insurance has an impact on development and poverty reduction. At the individual or household level, and at the government level. While impact studies on the effectiveness of index insurance are needed, preliminary experience indicates that index insurance has unleashed new capital, ideas and approaches -- delivering on some of its promise -- though many challenges still remain.