New insurance system supports 50,000 self-employed women in IIndia

Financial help for self-employed Indian women who received a fixed payment of $5 during days of record temperatures

A new insurance system has significantly benefited 50,000 self-employed women in India, providing financial support during periods of extreme heat. This innovative program was first implemented in the states of Rajasthan, Gujarat, and Maharashtra.

$5 Payments during extreme heat

Between May 18 and May 25, 2024, when temperatures exceeded 104 degrees Fahrenheit, beneficiaries received a fixed payment of $5. The program was designed by Climate Resilience for All, a non-profit organization, in collaboration with the Self Employed Women’s Association (SEWA) of India.

Kathy Baughman McLeod, CEO of Climate Resilience for All, emphasized the importance of this initiative, stating, “This is the first time that insurance payments are combined with a direct cash assistance program to supplement women’s incomes during dangerous heat periods.”

Some women received up to $19.80 each

The insurance was underwritten by reinsurer Swiss Re and provided locally by ICICI Lombard. This insurance model is increasingly seen by policymakers as an effective tool to help vulnerable communities quickly receive financial support following extreme weather events.

The goal is to ensure that women can continue to support themselves and their families even when harsh weather conditions make work difficult. About 92% of beneficiaries received additional compensation when the insurance was triggered, based on local conditions and the duration of the extreme heat.

Some women received up to $19.80 each, bringing total payments under the program to $341,553. While this amount may seem modest, it represents a significant income boost for these women, many of whom work in sectors vulnerable to extreme weather conditions, such as agriculture and informal labor.

A model for social protection programs

The introduction of this innovative insurance system demonstrates how social protection programs can provide real and tangible support to vulnerable communities. The combination of insurance and direct cash assistance could become a replicable model in other parts of the world where populations are exposed to extreme climate risks.

Source: Reuters