Thailand’s agricultural sector is exposed to increasingly frequent climate change-related extreme weather events. The fragility of the farmers being exposed to climate risk poses a threat to livelihoods and food security. Besides concrete risk mitigation measures, Thai farmers are in need of financial instruments that reduce the exposure to the economic impact of climate-induced agricultural losses.
The current climate, particularly drought, is threatening the agricultural sector, showing the fragility of the livelihoods of Thai farmers and the necessity of developing financial instruments for them.
Crop insurance is one of the key measures used to assist farmers in organizing their financial and production costs in the event of a disaster. Although several crop insurance products are existing on the Thai market, yet seem to be inaccessible to a large number of farmers due to multiple reasons such as lack of transparency, high transaction costs, slow indemnity payments, etc.
CTCN Support
This technical assistance aims to develop a technical and economic feasibility study for using blockchain technology for an improved parametric crop insurance product. Using blockchain technology has the potential to reduce transaction costs and automatize transparent indemnity payments, thus making crop insurance more attractive and accessible to farmers whilst remaining economically viable for insurance providers.
Beyond the feasibility study, an implementation roadmap will support the national stakeholders in developing, testing, and implementing such a blockchain-based product beyond this technical assistance.
The ultimate goal is to increase the resilience of Thai farmers to climate-induced extreme weather events.
Expected Impact
By introducing blockchain-based parametric crop insurance, this technical assistance will solve the existing challenges, such as high transaction costs, unclear terms and policies, and long indemnity payment times.
Furthermore, a co-contribution of this technical assistance will be an enhanced capacity of understanding and application of blockchain technology of key stakeholders for potential projects beyond this technical assistance.
Seeking Experts
The UN Climate Technology Centre and Network (CTCN) is inviting its Network members to assist Thailand. Interested qualified firms are invited to submit an Expression of Interest (EOI) to participate in a feasibility and viability study using Blockchain Technology for a real-time climate risk insurance system in Thailand's agricultural sector.
Please refer to the detailed documents HERE and at UN Global Marketplace. In case you are not a CTCN network member yet, you may still apply here.
