Sri Lanka farmers are to enjoy the application of the blockchain technology for microinsurance. This effort is being carried out through Oxfam, and Etherisc partnership.
Blockchain Insurance For Sri Lanka Farmers
The partnership between Oxfam and Etherisc will enable micro insurance for Sri Lanka farmers. Oxfam, a subsidiary of a nonprofit organization group in Sri Lanka that is focused on alleviating global poverty and etherisc, is a blockchain startup in the country. The partnership between the two entity was made known on Tuesday in London at a Coindesk’s organized event labeled blockchain for social good.
Microinsurance is the term given to insurance offered to people of low income. The insurance that would be issued with the blockchain technology will make payouts to be made quickly to the victims affected by bad weather events and related disasters. Also, the technology decreases the cost of operation and distribution to the barest minimum. This solves the major challenge that is encountered in the use of microinsurance.
The innovation will be utilized against one of the current weather index product which is supported by Oxfam in the country. The insurance lead of Etherisc, Michiel Berende stated that the firm is tapping into existing distribution channels that Oxfam obtain and checking into how blockchain can lower costs and increase efficiency and make it easy for other farmers to get access to the product.
Also, the director of Oxfam in Sri Lanka, Bojan Kolundzija noted that the firm has been making efforts over the years to support farmers. Bojan stated that the firm is excited to work towards the expansion of the innovative program with the use of blockchain technology and focused insurance industry experience from its partner, Etherisc.
Blockchain Impact On Microinsurance
The insurance coverage with blockchain technology will undergo two phases. The first phase which will make it easier for insurance companies to reach large groups of small-scale farmers according to Berende.
The second phase of the project involves utilizing trust minimizing, the transparent attributes of blockchain to reconfigure the agricultural value chain. This will allow large food producers to play a supporting role.
Berende who has spent some years working on grants funded scheme with small-scale farmers in India and other emerging economies noted that the project aims at exploring how it will bring in large multinationals to see how they can support the risks small-scale farmers face.