Blue Marble, a climate insurer, has entered into a partnership with the U.S. Agency for International Development (USAID) to deliver a new financial product aimed at boosting the climate resilience of Kenyan coffee farmers. This collaboration is part of the USAID’s Climate Finance for Development Accelerator (CFDA) Adaptation Finance Window, an initiative that aligns with the President’s Emergency Plan for Adaptation and Resilience (PREPARE). The adaptation finance program seeks to alleviate the risks associated with private sector-led climate adaptation strategies in emerging and frontier markets.
In Kenya, it’s estimated that around 560,000 smallholder coffee farmers do not have insurance protection against the impacts of climate change. This lack of coverage results in significant income and crop losses, which in turn affect the availability of necessary financing and investments. The new program will work with local financial institutions to provide credit and insurance services to these farmers, including a novel revenue insurance product designed to secure their incomes. This initiative will be implemented across the nation’s coffee-growing areas, offering protection against climate-related threats such as droughts, floods, and price volatility. It will provide automatic payouts to the farmers when specific climate-related criteria are met.
The objective of this initiative is to expand its reach to 50,000 farmers in Kenya by 2025. Jaime de Piniés, CEO of Blue Marble, highlighted the significance of climate adaptation in safeguarding the livelihoods of farmers globally, who are vital to the world’s food supply chains. He emphasized the economic importance of boosting their resilience in today’s interconnected global economy. “Working in collaboration with USAID, we aim to demonstrate how public-private partnerships can develop an innovative and cost-effective safety net for coffee farmers and their families. We are hopeful that this program will serve as a template for other regions and supply chains worldwide,” stated Piniés.
Gillian Caldwell, USAID’s Chief Climate Officer, pointed out the potential devastations of unexpected climate events on farmers, which could push them towards bankruptcy. “Blue Marble’s model shows how innovative insurance products can protect coffee farmers and act as a catalyst for increased public and private investments that build local community resilience,” Caldwell explained. The program is designed to provide financial stability to smallholder farmers, benefiting them, their families, and the broader community. With the security it offers, farmers can plan long-term, invest in sustainable practices, and escape cycles of poverty and debt. This stability not only improves the lives of farmers but also strengthens the resilience of the coffee supply chain, benefiting buyers.
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