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Weather Risk Management Services

About the Project
Project Name: 
Comprehensive agriculture risk management solutions for farmers
Type of Facility Project: 
Innovation Grant
Country of Operation: 
Asia and the Pacific
Project Thematic Focus: 
Product design
Agriculture and livestock - index crop
Type of Risk Carrier: 
regulated insurance company
Type of Distribution Channel: 
Agriculture output buyer (e.g. food processing company)
Credit union, cooperative or other member-based financial institution
Direct sales, own agent network
Mutuals, community-based organizations
Project Description: 

The project seeks to help farmers undertake optimal agricultural activities and generate sustainable income by minimizing the weather shocks they face through financial and technological risk management measures. The program involves the installation of Automated Weather Stations (AWS) to collect and disseminate weather data and facilitate the settlement of weather insurance claims.

It will implement weather and hybrid insurance products to address the critical risk-management needs of the farmers. The project will also provide weather forecasts and warnings to help farmers take proactive steps to minimize possible crop loses due to adverse weather conditions. Eventually, the project aims to raise awareness about agriculture risk and insurance solutions amongst farmers by training and equipping various intermediary organizations working in the region.


The project targets farmers and their families in the regions of Howrah and Kamrup, covering about 250 000 hectares and offering coverage to more 50 000 farmers over the 2-year project period. Most of the farmers are involved in small-scale agriculture (< 1 hectare of land) and traditionally grow potatoes and rice paddy.

Lessons from the Project
Learning Agenda: 
  • How does the Comprehensive Agriculture Risk program affect small-scale agriculture production (access to credit, productivity, agriculture practices, attitude to risk)?
  • What determines demand for index insurance by small farmers and how it can be stimulated?
  • How to make index insurance commercially viable?
  • What is an optimal contract that limits basis risk?
Emerging Lessons: 
  • Demand for index insurance varies depending on agricultural context.
  • The experience of WRMS suggests that insurance providers should keep contracts short, modular and comprehensive.
  • Farmers who have benefited from weather insurance for paddy and potato are now seeking coverage for other crops like oilseeds. 
  • Frequent product changes don’t help in building trust and awareness among the farmers.
  • Technology can be key to reduce costs and errors.
  • Technology can increase trust and help in crop management.
  • Claims settlement time has been reduced to about 50 days from an earlier lag of over 75 days due to better control at the time of policy issuance.
  • Use of multiple weather stations can help in dispersing risk and reducing claims.
  • WRMS was able to retain the channel partners and their interest in selling weather index insurance services and farmers by offering a wider array of agriculture risk management products and services.
About the Organization
Relationship with the Facility: 
Innovation grantee
Country of Head Office: 
Region : 
Asia and the Pacific
Type of institution : 
Insurance industry
Participation in Microinsurance: 
Consulting support
Organizational Overview: 

Weather Risk Management Services Ltd (WRMS) has played a pioneering role in developing the alternative agriculture insurance market in India to protect Indian farmers. This work involves developing and implementing a weather insurance contract, getting regulatory approval, building institutional capacities, linking Indian insurers with the international reinsurance market, preparing commodity exchanges for weather trading, advising the government on insurance subsidy, and developing low-cost technology to bring down administration expenses. The efforts of WRMS has enabled over 250,000 farmers across the country to access coverage under its various agriculture risk management services.

More about the Organization