Agricultural insurances based on meteorological indices: realizations, methods and research agenda

International audience; In many low-income countries, agriculture is mostly rainfed and crop yield depends highly on climaticfactors. Furthermore, farmers have little access to traditional crop insurance, which suffers from high information asymmetryand transaction costs. Insurances based on meteorological indices could fill this gap since they do not face such drawbacks.However, a full-scale implementation has been slow so far.In this article, the most advanced projects that have taken place in developing countries using these types of cropinsurances are described. Following this, the methodology that has been used to design such projects in order to choose themeteorological index, the indemnity schedule and the insurance premium, is described. Finally the main research issuesare discussed. In particular, more research is needed on implementation, assessment of benefits, how to deal with climatechange, spatial variability of weather and interactions with other hedging methods. Copyright2011 Royal MeteorologicalSociety