Index Based Livestock Insurance: Protecting Pastoralists Against Drought-Related Livestock MortalityExperiences and Insights from ILRI’s IBLI Program

Presenter DIBA KONE GALGALLO

IBLI uses satellite imagery to measure pasture levels, which it then puts through a response function to calculate an index of predicted livestock deaths caused by drought

How IBLI Works

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Satellites in the sky take pictures of the forage condition

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Forage availability satellite picture

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Pasture availability data

Pasture availability data

Prediction of livestock deaths

(Predicted Mortality Index)

Prediction of livestock deaths

(Predicted Mortality Index)

Conversion (Response function)

Conversion (Response function)

• Forage availability is linked to the overall body condition of the livestock

• When the forage level is above or equal to the normal, no livestock mortality is predicted

• Livestock stress and consequent mortality is experience when the forage level goes way below the “normal level”

Construction of the index

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The pastoralists are expected to bear a small part of the cost of losses incurred- usually referred to as a deductible

What is the Trigger Level

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At a predicted mortality level of 20%:

o Expected compensation is the corresponding 10% (20% - 10%) of insured livestock value

At predicted mortality level is 50%:

o Expected compensation will be 40% (50% - 10%) of insured livestock value

How does the trigger work

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CATTLE

CAMEL

GOATS AND SHEEP

LIVESTOCK TO BE INSURED

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• Pastoralists are informed through sms, agents and chief networks

• It is Voucher based

• M.o.U signed with local bank in the area

• Transfer of full claim funds to the bank

• Claims register presented to the bank

• Client presents voucher at the bank and redeems for cash. Identification document is required

• Voucher valid for a period of 12 months

Compensation Process

10For related information, visit www.ilri.org/ibli

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