GIIF worked with MITADER to conduct an Index Insurance Feasibility Study that consists of a value chain analysis for 4 priority crops (beans, cotton, maize, and cashew nuts). Results from the study where disseminated during a stakeholders workshop in Maputo in August 2018, shedding light on farmers’ willingness and ability to pay for insurance premiums as well as identifying key aggregators through which index insurance products could be distributed in the country. GIIF is providing financial support to Hollard Mozambique to help the firm expand its agricultural insurance business line. As

In Mozambique, agriculture accounts for approximately 32% of GDP and involves over 81% of the population. Yet, only a fraction of Mozambique’s potentially arable land is currently under cultivation. This lack of arable land usage is in large part due to risk aversion on the part of farmers and financial institutions since natural hazards such as droughts and floods regularly affect agricultural production. Up until recently, no market for agriculture insurance products existed for smallholder farmers in Mozambique leaving poor farmers in the country highly exposed to natural perils. This hinders their access to third-party capital, discourages the use of new farming techniques/technologies and overall hampers the ability of smallholders to exit poverty. As a direct result of a Local Capacity Building grant awarded to Guy Carpenter in 2011 from the World Bank Group's GIIF, the firm ─ in conjunction with the Asia Risk Centre Inc., Hollard Mozambique and EMOSE ─ designed, developed, and deployed two agriculture weather index insurance pilots in Mozambique in late 2012. The index-based insurance products covered maize farmers in the district of Chimoio and cotton production in the districts of Lalaua and Monapo.