Weather Indexes for Developing Countries
This book reviews the degree to which weather events contribute to human and economic suffering and examines the possible linkages between the emerging weather markets and public and private solutions to the problems that weather-based natural disasters create.
The book states that by segmenting and layering out weather risks, there are numerous opportunities for risk aggregators within a country to share risks globally.
The book examines three possible applications of weather insurance in developing countries: providing weather risk coverage to:
- Mutual insurance groups,
- Farmers and agri-businesses directly,
- Governments, to protect their exposure when they offer catastrophic insurance and provide disaster aid.
The book states that:
- There is a need for infrastructure for measuring weather;
- Such a supporting infrastructure has vast social benefits;
- These social benefits can only be recognised once the numerous ways that weather indexes can be used to cope with and manage weather-based risks are understood.
The paper concludes by identifying the following actors that can play a role in using the information and infrastructure to address the problems brought on by extreme weather events:
- Private companies within developing countries;
- Global markets that move the weather risks out of developing countries;
- Governments of developing countries;
- The international donor community.
