The FT highlights portfolio company WorldCover and their mission to provide affordable crop insurance to the world's smallholder farmers. More than 20,000 farmers in Ghana, Kenya, and Uganda are now using the platform - which provides automatic payouts (sans claims adjustment) based on satellite data that measures rainfall.
The fact that the policies are based on third-party data, such as rainfall measured by satellite and ground sensors, means they are objective, thereby avoiding disputes and fraudulent claims. Eventually, the Etherisc group plans to extend the system to include crop disease affected by the weather, such as brown plant hopper, which is linked to dry conditions. Insurers are keen to add crop risk to their portfolios, says Mr Sheehan, who has attracted interest from Swiss Re and Lloyd’s. “At the moment, it is under-represented because it has not been economically viable to serve so many low-budget clients.”