DHAKA: IFC, a member of the World Bank Group, and Bangladesh’s one of the leading private insurers Green Delta Insurance Company Ltd on Tuesday signed an agreement to develop insurance products for individual farmers, agribusinesses, and financial institutions lending to farmers for protection from weather-related risks such as drought, excess rain, and cyclones.
IFC will assist Green Delta, an IFC equity client, to develop insurance products that minimize the impact of crop losses due to natural disasters, provide advisory support for distributing and administering these products, increasing lending and business to farmers and improving their risk profile.
Kyle F Kelhofer, Country Manager of IFC and Farzana Chowdhury, Managing Director and CEO of Green Delta signed the agreement on behalf of their respective organizations.
‘As a leading insurance institution in the country we believe crop insurance protects rural economy,’ said Farzana Chowdhury adding more, ‘Weather-index insurance will help regulate farmers’ income and infuse reliability to this uncertain sector.’
Agriculture contributes 20 percent of GDP and employs close to half the labor force.
However, the country is vulnerable to frequent natural disasters that cause serious damage to crops and livestock each year. Consequently, lenders are unwilling to extend credit to a sector exposed to natural disasters without risk-mitigating measures.
‘Through index-based insurance, IFC will help provide a safety net to agribusiness and offer a range of financial services to farmers aimed at securing their livelihoods,’ said Kyle F Kelhofer, IFC Country Manager for Bangladesh.
The project is partly funded by IFC’s Global Index Insurance Facility, a multi-donor trust fund supporting development and growth of local markets for weather and disaster index insurance.
It focuses on developing countries, primarily in Asia, Sub-Saharan Africa, Latin America and the Caribbean. Donors include the Netherlands, European Union, and Japan.
The government-supported Pilot Program for Climate Resilience project for Bangladesh also provides funds. It aims to increase revenues of farmers and agribusinesses through sustainable and climate-smart technologies and practices.
GIIF has insured over 600,000 small farmers and businesses, with an insurance value of $119 million, and reaching over one million with information and access to index insurance. GIIF’s objective is to expand the use of index insurance as a risk management tool in agriculture, food security and disaster mitigation, particularly in communities where insurance is rarely available.
From Green Delta Mr. Nasir A Choudhury, Advisor, ASA Muiz, Consultant, Farid A Choudhury, Senior Additional Managing Director along with other senior officials attended the signing ceremony. On IFC’s behalf, Rachel Freeman, Andrew Charles McCartney, Sawsan Eskander and Monzurul Haque attended the signing ceremony.
About Green Delta
Green Delta Insurance Company Ltd. is one of the leading private non-life insurance companies in Bangladesh, incorporated in 1985 as a public limited company. Along with traditional general insurance products, Green Delta has always been innovative and focused on products to cater the mass and thrust sectors of the country’s economy including Small & Medium Enterprises (SMEs), microinsurance, insurance for garment workers, migrant labors and many more. For more information, visit www.green-delta.com
About IFC
IFC, a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector. Working with private enterprises in about 100 countries, IFC uses its capital, expertise, and influence to help eliminate extreme poverty and boost shared prosperity. In FY14, IFC provided more than $22 billion in financing to improve lives in developing countries and tackle the most urgent challenges of development. For more information, visit www.ifc.org.
BDST: 1357 HRS, FEB 24, 2015
