GIIF is funded by the European Union, Japan and the Netherlands.
The EU is the primary donor partner to the GIIF Trust Fund with a focus on the African, Caribbean and Pacific Group of States (ACP). The governments of Japan and the Netherlands are providing additional support to different regions/countries where IFC operates.
Feasibility study for macro and meso-level index insurance - Dominican Republic
Project Start date/Activity Initiation date
Ministry of Agriculture
The recent path of Tropical Storm Isaac in September 2012 caused the destruction of plantain fields in the South Region. This situation forced the national authorities to provide in-kind assistance (i.e. planting materials, fertilizers, cleaning labor, land preparation) to the most affected farmers. Although some private insurers provide agriculture insurance, the Ministry of Agriculture does not have a pre-defined budget to tackle the negative effects caused by events in the agricultural sector while it faces significant contingent liabilities in this sector.
Macro, Meso and Micro level index-based insurance feasibility studies
The Ministry of Agriculture of the Dominican Republic has requested assistance from the World Bank to assess the feasibility of macro- and meso-level index-based insurance.
At macro-level: The WB GIIF Team conducted a feasibility studyfor macro-level agriculture index-based insurance on the Hurricane Trajectory Index (HTI) and on the El Niño Southern Oscillation (ENSO) indicator. The study verified that HTI insurance is possible, and provided product design suggestions and pricing. For the ENSO insurance, the historic weather data is not sufficient to establish suitable correlation with agriculture losses in the country.
At meso-level: The WB GIIF Team also assessed the feasibility of a meso-level area yield index insurance for the national federation of cocoa growers based on historic production data, proving that it can work, and designed and priced a product . It did indicate, however, that risk mitigating measures (to protect against rats, birds and other pests for example) might have a more favorable cost-benefit ratio.
In both cases, the team also provided recommendations for the organizational implementation of possible index insurance.
To address shortcomings in the historic weather data and the density and distribution of the weather station network, the WB GIIF Team is producing a gridded weather database that calibrates historic satellite data with historic weather station data to provide a complete history of rainfall and temperature data for the last 30 years in both parts of the Hispaniola island (Dominican Republic and Haiti). This will allow interested parties to fine tune product design and pricing and provide the credibility desired by international reinsurers.
Various departments in the Ministry of Agriculture, Dominican Coffee Council (CODOCAFE), Cacao National Commission (CONACADO); National Institute of Hydraulic Resources (INDRHI); the National Office of Meteorology (ONAMET); Aseguradora Agropecuaria Dominicana S.A. (AGRODOSA Insurance Company),; USAID Dominican Republic