Policy against disasters

Insurance companies could provide protection during droughts in Africa. How exactly this could be done is what the industry is currently trying to figure out. First experiences are available. An interview with the Managing Director of the Munich Re Foundation, Thomas Loster

(c) Christoph Püschner/Diakonie Katastrophenhilfe
Kenya: Farmer Elizabeth Kiilu and her goats. The insurance often runs through farmers' associations, which often count hundreds or even thousands of farmers as members. © Christoph Püschner/Brot für die Welt

Thomas Loster

Thomas Loster is a geographer and Managing Director of the Münchener Rück Stiftung (Münchener Rück Foundation). From 1988 to 2004 he was employed in the GeoRisikoForschung (GeoRiskResearch) department at Münchener Rück, where he began with digital cartography, and managed the specialist fields of flood risk research, weather risk research and NatCatSERVICE's natural disaster statistics. As a weather and climate expert he represented Münchener Rück at global climate change conferences (COP). From 2003 to 2005 Loster was Head of the Climate Change Working Group of the UNEP Finance Initiative (UNEP FI). In July 2004 he took over the position of Managing Director of the Münchener Rück Stiftung. The foundation addresses major global challenges – poverty alleviation, environmental and climate change, water as a resource and risk factor, demographic change and disaster mitigation – and supports people at risk. Thomas Loster is a member of the German National Committee of the UN Decade of Education for Sustainable Development and, from 2006 to 2010, was a member of the German Council for Sustainable Development. He is a member of the World Bank / IFC Advisory Panel on Business and Sustainability. In addition, he is a member of the Executive Board of the Munich Climate Insurance Initiative (MCII), which seeks to find insurance solutions to weather-related disasters in developing and newly industrialised countries.

 

Munich Re Foundation

GIZ

Tilman Wörtz

Tilman Wörtz studied politics and economics in Erlangen, Paris and Mexico City. Since 2000 he has been working as a reporter for Zeitenspiegel Reportagen. He is interested in the economic and political development of countries in crisis.

Mr Loster, how can insurance companies help a farmer in Africa adapt to climate change?

 

Loster: Insurance companies certainly cannot eliminate the problems, but they can provide some relief. In some cases, they have already done that. But in many places we are just at the beginning of this development and cannot expect miracles. Insurance packages in Africa need to be structured quite differently than in Europe or the US. We in the foundation are also contact persons in this process.

 

In rural Africa a representative in a suit cannot simply walk across the fields and sell insurance

 

What concrete experiences are there so far?

 

An interesting example is the Rural Resilience Initiative R4 in East Africa. Oxfam trained 200 farmers in Ethiopia in 2009. The focus was on cultivation methods that should help them adapt to extreme weather conditions which are occurring more frequently. Part of the project included insurance against the effects of extreme drought. Meanwhile, the United Nations World Food Programme (WFP) has joined the project and is working with 57,000 farmers in five countries. $125,000 in insurance amounts have already been paid. The insurance often runs through farmers' associations, which often count hundreds or even thousands of farmers as members. It helps the association and those affected, of course, if someone shows up with a $20,000 check after a drought and says, ‘Well, distribute it among those who were hit the hardest.’ The money paid out helps people overcome the crisis more easily. Farmers then do not have to sell their tools, cattle or other productive goods to feed their families.

 

The payout is not determined based on individual damage?

 

No, that would be far too costly with the small insurance amounts. It is a so-called index insurance. It goes into effect when, for example, a certain temperature or drought level in a region is exceeded. A simplified criterion would be: 'If it's over thirty degrees Celsius for a whole month, it'll payout'. This is an elegant and simultaneously uncomplicated method. There is just one problem: A farmer may experience losses, although the temperature in the region remained just below the defined value. It is then very important to explain this well to him. The people in poor countries so far mostly only know how to hedge themselves with savings, where something continuously comes back. With insurance, on the other hand, there is only money in hardship. That's new to them.

 

Can the data for index insurance be determined accurately enough?

 

Of course, data collection is a problem in many poor countries, where metering stations may be hundreds of miles away and the values in between must be extrapolated. The individual farmer may have the feeling that it was terribly hot and he is now entitled to a payout, even if this value cannot be objectively proven. The criterion must be as simple and understandable as possible, and many mistakes have already been made in that sense.

 

We are in a learning process where all sides need to get to know each other better: Governments, aid organisations, insurance companies and people living at risk

 

Please give us an example.

 

The WFP has teamed up with the African Union to create a major insurance package called African Risk Capacity (ARC), which operates at national levels. It is up to the individual governments to develop a precautionary strategy for extreme droughts and famine. The ARC then develops a suitable insurance offer. When the problems arise, payments are made from the ARC programme. However, Malawi, for example, has recently defined a complicated ‘moisture index’ that uses several values to determine how much water the plants need to absorb. This indicator was not easy to understand by a simple person and it caused great dispute whether payments should be made or not.

 

Insurance companies can only afford farmers who have at least minimal income. However, the poorest are often most affected by climate change.

 

In some cases, these can be integrated through work performance. The already described R4 initiative in East Africa also offers poor helpers insurance coverage, for example, if they help prevent erosion of the soil. In that case they are not required to pay any premiums and are still covered because their work is valued.

 

Oxford economist Stefan Dercon says: ‘Our disaster relief is medieval’. It usually arrives too late, because aid organisations must first collect funds through campaigns before the victims can receive help. Insurance companies were able to help more quickly. However, based on the volume of current offers it looks like we are still very far from such a form of provision in Africa.

 

I have had several discussions with Stefan Dercon. I think we need both: Reconstruction aid and protection against heavy blows. Such approaches have only been implemented for a little over five years and have maturities of up to ten years and more. So, miracles should not be expected yet. We are in a learning process where all sides need to get to know each other better: Governments, aid organisations, insurance companies and people living at risk.

 

Do aid organisations support insurance companies in mitigating climate risks?

 

Cooperation between the private and public sectors is a prerequisite for the success of cooperative development, generally referred to as Public Private Partnerships (PPP). Insurances have gained quite a new status through the discussion in recent years.

 

Does your sponsor, Munich Re, see any chance of profitability from agricultural insurance in Africa?

 

Yes. Munich Re is already active in some of the more developed insurance markets in Africa, for example in South Africa and Zambia. And it has been acting as a reinsurer, for example for ARC. However, the transaction volume is still insufficient in many African countries, and often the right products have not yet been developed. For the time being, we at the Munich Re Foundation are available as contact persons.

 

Go back

Similar articles

The human finca

Interview with Marvin Antonio Garcia Otero

In Eastern El Salvador, campesinos are cultivating a self-image to encourage rural youth to remain in rural areas. With help from Caritas, they have adjusted the cultivation methods to their soils and traditions - Marvin Antonio Garcia Otero,the deputy director of Caritas of the Diocese of San Miguel believes this is the best way to prevent rural exodus and criminality.

Read more

(c) Privat

A classroom in the Garden of Eden

By Iris Manner

Deforestation harms people and the environment. With nurseries, farmers can earn money and do good. You just have to know how to do it

Read more

Is the international community still on track in the fight against hunger?

Interview with Miriam Wiemers (Welthungerhilfe)

The Global Hunger Index (GHI) 2020 shows that the world is not on track to meet the international goal of “zero hunger by 2030”. If we continue at our current speed, around 37 countries will not even have reached a low hunger level by 2030.

Read more

Climate Adaptation Summit 2021: ‘We can do better’

Event report by Jan Rübel (Zeitenspiegel)

The first Climate Adaptation Summit put climate adaptation at the center of politics for the first time. The virtual meeting united global players with one goal: building resilience is just as important as climate protection itself. Around 15,000 participants discussed direct proposals.

Read more

GFFA 2021 focussed on climate and COVID-19

A report by David Sahay (Zeitenspiegel)

110 speakers from 120 countries met virtually at the Global Forum for Food and Agriculture (GFFA) to discuss the challenges to global food supply. They asked the question: How can food systems support the health of people and the planet?

Read more

Mr. Samimi, what is environmental change doing to Africa?

Interview with Cyrus Samimi (IAS)

Environmental change is having a particularly strong impact on the African continent. Its landscapes see both negative and positive processes. What is science's view of this? A conversation with Cyrus Samimi about mobility for livelihoods, urban gardening and dealing with nature.

Read more

“We have to prepare for the unexpected”

Interview with Dr Maria Flachsbarth (BMZ)

In August, Germany’s development ministry set up a division concentrating on One Health topics. Parliamentary State Secretary Maria Flachsbarth on knowledge gaps at the human-animal-environmental interface, the link between One Health and food security, and lessons learnt from previous pandemics.

Read more

KLAUS WOHLMANN / GIZ

"Farmers are smart"

Interview with Maria Andrade

From the lab to the masses: Maria Andrade bred varieties of biofortified sweet potatoes which are now widely used all over the continent. She sets her hope on the transformation of African agriculture.

Read more

©WFP/Rein Skullerud

Revolutionising Humanitarian Aid

A contribution by Ralf Südhoff

Financial innovations can prevent a crisis turning into a catastrophe. The livelihoods of people in affected areas may well depend on intervention before a crisis – and on risk funds.

Read more

"We must mobilise all available resources"

A contribution by Ismahane Elouafi (ICBA)

Freshwater deficits are affecting more and more people throughout the world. In order to counter this, our global food system will have to change, our author maintains. A case for more research on alternative crops and smart water solutions.

Read more

© GIZ

Resilient small-scale agriculture: A key in global crises

A contribution by Kerstin Weber and Brit Reichelt-Zolho (WWF)

Biodiversity and sustainable agriculture ensure the nutrition of whole societies. But there is more: These two factors also provide better protection against the outbreak of dangerous pandemics. Hence, the question of preserving ecosystems is becoming a global survival issue.

Read more

The Forest Maker and his director

Double interview with Tony Rinaudo and Volker Schlöndorff

Tony Rinaudo uses conventional reforestation methods to plant millions and millions of trees – and Volker Schlöndorff is filming a cinema documentary about the Australian. The outcome so far: An educational film on behalf of the BMZ (Federal Ministry for Economic Co-operation and Development).

Read more

(c) Nina Schroeder/World Food Programme

Green from the growth container

A contribution by Maria Smentek (WFP)

If there is a lack of fertile soil and rain, hunger breaks out quickly. Maria Smentek from the World Food Programme (WFP) explains how farmers and pastoralists can counter climate change with hydroponic-systems.

Read more

Gender equality: Essential for food and nutrition security

A contribution by Carsta Neuenroth (BfdW)

The majority of producers in developing countries are women. Although they contribute significantly to the food security of their families, they remain chronically disadvantaged in male-dominated agriculture in terms of access to land, credit, technology and education.

Read more

Can we win the race against deforestation?

Interview with Bernadette Arakwiye und Salima Mahamoudou (World Resources Institute)

Deforestation is leading to a shortage of ressources. What are the options for counteracting? A conversation with Bernadette Arakwiye and Salima Mahamoudou about renaturation and the possibilities of artificial intelligence.

Read more

From Berlin to Yen Bai: 10,000 trees for Vietnam

A contribution by GIZ and BMZ

It began with clicks at a trade fair and ends with concrete reforestation: a campaign at the Green Week in Berlin is now enriching the forests of the Yen Bai Province in Vietnam. A chronicle of an education about climatic relevance to concrete action - and about the short distances on our planet.

Read more

Quinoa could have a huge potential in Central Asia, where the Aral Sea Basin has been especially hard-hit by salinisation.

Planetary Health: Recommendations for a Post-Pandemic World

A contribution by Dr. Kathleen Mar and Dr. Nicole de Paula

Against the backdrop of the COVID-19 pandemic, health is receiving unprecedented public and political attention. Yet the fact that climate change is also affecting the environmental and social determinants of health in a profound and far-reaching way deserves further recognition.

Read more

© GIZ

Actual Analysis: The locusts came with the crises

A report by Bettina Rudloff and Annette Weber (SWP)

The Corona-Virus exacerbates existing crises through conflict, climate, hunger and locusts in East Africa and the Horn of Africa. What needs to be done in these regions? To face these challenges for many countries, all of these crises need to be captured in their regional context.

Read more

"Extreme is the new normal"

A report by Alexander Müller and Jes Weigelt (TMG)

As the climate changes, the population of Africa is growing and fertile land and jobs are becoming scarcer. New ways are currently leading to urbanisation of agriculture and a new mid-sized sector in the countryside

Read more

© GIZ / Angelika Jacob

This is how developing countries can adapt better to droughts

A contribution by Michael Brüntrup (DIE) und Daniel Tsegai (UNCCD)

Droughts are the natural disasters with far-reaching negative consequences. While rich countries are still vulnerable to drought, famines are no longer found.

Read more

(c) Christof Krackhardt/Brot für die Welt

Together and resourceful against worldwide hunger

A contribution by Brot für die Welt

Climate change disturbs the climate in Ethiopia. The answer from small farmers in the northern region is convincing: diversify!

 

Read more

(c) Christoph Mohr/GIZ

Microinsurance against climate change

A contribution by Claudia Voß

Climate change is destroying development progress in many places. The clever interaction of digitalisation and the insurance industry protects affected small farmers.

Read more

(c) Nina Schroeder/World Food Programme

Hunger is caused by people, not the climate

Interview with Jacob Schewe (PIK)

A study by the World Bank predicts that millions of people in sub-Saharan Africa will have to leave their homelands because of climate change. We have spoken with one of the authors

Read more

(c) Christoph Püschner/Brot für die Welt

The North bears the responsibility, the South bears the burden

A report by Susanne Neubert (SLE)

Adaptation to climate change can be achieved by making agriculture more environmentally sustainable – if the rich countries also reduce their emissions

Read more

5 Questions for Gunther Beger (BMZ): What must be done?

Interview with Gunther Beger (BMZ)

How much will it cost to sustainably end world hunger by 2030? This question was posed by the German Federal Ministry for Economic Cooperation and Development (BMZ) that commissioned two research teams with finding an answer. The results of the studies will be presented on October 13 in the run-up to World Food Day.

Read more

„You must be multisectoral in your thinking”

Interview with Adriano Campolina (FAO)

For years, place-based approaches to development have been considered important features in development cooperation, at the BMZ and in FAO. Both organisations are aiming at advancing these approaches: an interview with Adriano Campolina from the FAO on territorial and landscape perspectives.

Read more

5 Questions for Jann Lay: What is Corona doing to the economy?

Interview with Jann Lay (GIGA)

The Corona pandemic is hitting economies around the world very hard - but developments in African countries are quite diverse. There are different speeds, resiliences and vulnerabilities. What are the reasons for this? Apl. Prof. Jann Lay of the GIGA Institute provides answers.

Read more

(c) GIZ

COST-BENEFIT ANALYSES FOR MORE SOIL CONSERVATION

With the help of sustainable farming methods, soils can be preserved and made fertile again. The investment required is also worthwhile from a financial perspective.

A project of GIZ

Read more

Resilience in times of crisis

Yemen is currently experiencing one of the worst disasters, due to war, hunger and disease outbreaks. The GIZ is locally engaged to improve the nutrition and resilience of Yemenites.

A project of GIZ

Read more

Building our food systems back better

A contribution by Jes Weigelt and Alexander Müller

What is required to make food systems provide sufficient, healthy food while not harming the planet? How should food security be maintained given the threat posed by climate change? Our authors look at some aspects of tomorrow’s food systems against the backdrop of the corona crisis.

Read more

© GIZ

One Health – What we are learning from the Corona crisis

A contribution by Dr. May Hokan and Dr. Arnulf Köhncke (WWF)

Due to the coronavirus crisis, the connection between human and animal health has gained new attention. Politicians and scientists are joining forces to propagate the solution: One Health. But what is behind the concept? And can it also guarantee food security for all people worldwide?

Read more

Frank Schultze / Agentur_ZS

Visions in agriculture

Video by Frank Schultze and Jan Rübel

At the beginning of December 2018, AGRA's board of directors met in Berlin. The "Alliance for a Green Revolution in Africa" ​​panel discussed the next steps in their policy of modernizing agriculture. How to go on in the next ten years? One question - many answers from experts.

Read more

The state of food security in Cape Town and St. Helena Bay

A study by Markus Hanisch, Agustina Malvido, Johanna Hansmann, Alexander Mewes, Moritz Reigl, Nicole Paganini (SLE)

Post-Covid-19 lockdown: How food governance processes could include marginalised communities - an extract of the results of an SLE study applying digital and participatory methods.

Read more

5 questions posed to the SEWOH commissioner Dirk Schattschneider

Interview with Dirk Schattschneider (BMZ)

For about a year now, Dirk Schattschneider has been the commissioner for the special initiative "ONEWORLD No Hunger" (SEWOH) of the BMZ. In the interview, he looks back on the challenges of the past year and at the same time takes a look into the future.

Read more

School Feeding: A unique platform to address gender inequalities

A contribution by Carmen Burbano de Lara (WFP)

Besides the well known impacts of Covid19 lockdowns for the adult population, the associated school closures led to 90 percent of the world’s children with no access to schools. However, school meals are in often the only daily meal for children. Without access to this safety net, issues like hunger, poverty and malnutrition are exacerbated for hundreds of millions of children.

Read more

Success story allotment garden: Food supply and women's empowerment

A contribution by Nadine Babatounde and Anne Floquet (MISEREOR)

To prevent malnutrition among young children and strengthen the role of women in their communities, Misereor, together with the local non-governmental organisation CEBEDES, is implementing a programme on integrated home gardens in Benin - a series of pictures.

Read more

Not waiting for a savior

An article by Lidet Tadesse

While Africa is the least affected region by Covid-19 so far, the number of confirmed cases and deaths on the continent is quickly rising. Despite the challenges many African countries continue to face, the African response to the coronavirus pandemic displays innovation and ingenuity.

Read more

A partnership to fight hunger

A contribution by GAFSP

The Global Agriculture and Food Security Program (GAFSP) was launched by the G20 countries in 2010 in response to the 2008-09 food price crisis to increase both public and private investment in agriculture. An overview of the programme's approach, results and impact.

Read more

Good health is impossible without healthy food

A contribution by Heino von Meyer

Corona makes it even more difficult to achieve a world without hunger by 2030. So that this perspective does not get out of sight, Germany must play a stronger role internationally - a summary of the Strategic Advisory Group of SEWOH.

Read more

UNFSS Pre-Summit: What did it achieve?

Interview with Martina Fleckenstein (WWF), Michael Kühn (WHH) and Christel Weller-Molongua (GIZ)

After the summit means pre-summit: It was the first time that the United Nations held a summit on food systems. Martina Fleckenstein (WWF), Michael Kühn (WHH) and Christel Weller-Molongua (GIZ) reviewed the situation in this joint interview.

Read more

Food system transformation starts and ends with diversity

A contribution by Emile Frison and Nick Jacobs (IPES-Food)

While having failed to solve the hunger problem, industrial agriculture appears to be causing additional ones both in environmental and health terms. Emile Frison and Nick Jacobs call for a transformation.

Read more

Land Rights, Gender and Soil Fertility in Benin

A contribution by Dr. Karin Gaesing and Prof. Dr. Frank Bliss (INEF)

Especially in densely populated areas, land pressure leads to overexploitation of available land and a lack of conservation measures. The West African country of Benin, with heavily depleted soils in many places, is no exception.

Read more

'It has never been more possible'

Interview with Carin Smaller (Ceres2030)

Over a period of two years, the Ceres2030 team spent researching answers to the questions of how much it will how much it will cost to realize SDG 2 and where that money should be spent most effectively. IISD Senior Advisor and Ceres2030 Co-director Carin Smaller about small farmers, machine learning and women empowerment.

Read more

"Agricultural research unties the Gordian knot"

Interview with World Bank Vice President Voegele

The CGIAR agricultural research organization is systematically repositioning itself. We spoke with Juergen Voegele, Vice President for Sustainable Development at the World Bank, about progress to date - and discuss what needs to be done collectively to stop global hunger in ten years.

Read more

Controversy: Do supply chains need liability rules?

Discussion about the potential supply chain law

The German government is struggling to pass a supply chain law. It is intended to address violations of human rights, social and environmental standards. What would the consequences be for business? A double interview with Veselina Vasileva from GEPA and economics professor Andreas Freytag.

Read more

More than just a seat at the table

A contribution by Welthungerhilfe

Africa is home to the world’s youngest and fastest growing population. For many young people, agriculture could offer a job perspective. But to improve the living conditions and job prospects of young people in rural areas, political reforms and investments are desperately needed, as these people will be at the centre of agriculture and agricultural development in the future.

Read more

(c) Kate Holt / Africa Practice

Leveraging investment impacts

A contribution by Heike Baumüller, Christine Husmann, Julia Machovsky-Smid, Oliver Kirui, Justice Tambo

Any initiative whose aim is to reduce poverty in Africa should focus first on agriculture. But what kind of investment has the greatest impact? The use of scientific criteria provides some answers.

Read more

Pesticides – a blessing or a curse?

A debate between Lena Luig and Ludger Weß

What are the consequences of using synthetic pesticides in agriculture? Where do they help, where do they harm? Lena Luig, expert for the development policy organization INKOTA, and science journalist Ludger Weß discuss this controversial topic of international scope.

Read more

Karel Prinsloo/Arete/Rockefeller Foundation/AGRA

"Nutrition is a human right"

Interview with Joe DeVries (AGRA)

Joe DeVries is a breeder – and Vice President of AGRA (Alliance for a Green Revolution in Africa). What are the chances and risks of a ’green revolution‘ in Africa? A discourse between Jan Rübel and him about productivity, needs, and paternalism.

Read more

KLAUS WOHLMANN / GIZ

Wanted: German investment in African agriculture

Interview with Stefan Liebing

Stefan Liebing is chairman of the Africa Association of German Business. The manager calls for a better structure of African farms. Jan Rübel asked him about small farmers, the opportunities for German start-ups and a new fund.

Read more

Global responsibility: Tackling hunger is the only way forward

A contribution by Lisa Hücking (WHH)

Chancellor Merkel has begun an ambitious European political programme: Striving for compromise in budget negotiations, an orderly Brexit as well as an appropriate response to the corona crisis. Unfortunately, one of her positions that she previously held is nowhere to be found: Africa's prosperity is in the interest of Europe. 

Read more

Africa's face of agriculture is female

A contribution by Beatrice Gakuba (AWAN-AFRIKA)

Africa has a huge opportunity to make agriculture its economic driver. However, the potential for this is far from being made exhaustive use of, one reason being that women face considerable difficulties in their economic activities. The organisation AWAN Afrika seeks to change this state of affairs.

Read more

Innovations for a secure food supply

A contribution by German Agribusiness Alliance

The COVID 19 pandemic is hitting developing and emerging countries and their poorest populations particularly hard. It is important to take countermeasures at an early stage. Companies in the German agricultural sector want to make their contribution to ensuring the availability of urgently needed operating resources.

Read more

(c) Michael Bruentrup/DIE

News from the starting block: Changeover

A contribution by Michael Brüntrup (DIE)

The region of Sub-Saharan Africa is on the decisive verge of a great development boost in farming: it could skip entire generations of technological development. But how? About possible roles and potentials of digital services.

Read more

Joerg Boethling/GIZ

"The Green Revolution reaches its limits"

Interview with Stig Tanzmann (BfdW)

Stig Tanzmann is a farmer and adviser on agricultural issues at ‘Bread for the World’. Jan Rübel interviewed him about his reservations about AGRA's strategy.

Read more

Frank Schultze / Agentur_ZS

The communicator

A contribution by Jan Rübel

What do electrical engineering, telecommunications and agriculture have in common? They arouse the passion of Strive Masiyiwa: Thirty years ago, he started an electrical installation company with $75, later riding the telecommunications wave as a pioneer. Today he is committed to transforming African agriculture.

Read more

MarkIrungu /AGRA

Spiritual mortar for the young generation

A contribution by Jan Rübel

Fred Swaniker is working building a new era of leaders. And what about agriculture? ‘It needs to be more sexy!’

Read more

JOERG BOETHLING / GIZ

Continent in an uptrend

A report by Dr. Agnes Kalibata (AGRA)

Partnering for Africa’s Century: Innovation and Leadership as Drivers of Growth and Productivity in Rural Areas

Read more

Mr. Marí, what happened at the alternative summit?

An Interview with Francisco Marí (Brot für die Welt)

Brot für die Welt (Bread for the World) did not attend the UNFSS pre-summit. Instead, the organisation took part in a counter-summit that took place at the same time. A conversation with Francisco Marí about the reasons, the process - and an outlook for the future

Read more

Biodiversity and agriculture – rivalry or a new friendship?

A contribution by Irene Hoffmann (FAO)

In this article, the author describes what we know about interlinkages, what role agriculture has to play in the sustainable use and conservation of biodiversity, and what the necessary changes in agricultural systems might look like, both on small and large-scale farms.

Read more