This brief describes the implementation of index-based flood insurance (IBFI) in countries with large smallhold farming communities to insure farmers against flood losses. The brief outlines the objectives of the IBFI scheme in Bihar, India and identifies key challenges and recommendations.
An IBFI scheme is currently being piloted in India and Bangladesh to increase the short term coping capacity of small holding farmers against flood risk. Two hundred farmers are enrolled for this pilot program in villages around Muzzafarpur district in India. This innovative approach aims to streamline and fasten effective insurance payouts, so that money reaches affected farmers in timely manner. The project integrated advanced numerical modelling techniques for modelling long-term flood patterns, high-resolution remote sensing data and statistical models to determine flood thresholds, which could trigger speedy compensation payouts. Effective end-to-end solutions are being developed in collaboration with a range of organizations and experts from central and state government bodies, private insurance firms, community-based organizations (CBOs) and nongovernmental organizations (NGOs).