As the rainy season sets in across the Philippines, it brings both hope for renewed harvests and the threat of destructive typhoons. Despite their vital role in our food security, farmers remain among the most vulnerable to extreme weather. In fact, they repeatedly bear the brunt of these events with very limited financial protection.
In 2024 alone, the Department of Agriculture reported agricultural losses amounting to ₱57.8 billion, affecting over 1.4 million farmers and fisherfolk. These losses were caused by a mix of calamities, from droughts to typhoons.
The Protection Gap
However, a significant protection gap exists. According to the World Bank, only one-third of farmers in the country are insured, even with government-subsidized programs available. This leaves the majority financially exposed when disaster strikes.
To address this, leading insurtech company Igloo aims to help bridge this gap with Weather Index Insurance (WII). This is an index-based insurance coverage specifically designed to protect agriculture businesses and farmers against climate risks.
A Smarter Solution: How Weather Index Insurance Works
Unlike traditional insurance that requires assessing actual damages after an event, WII is different. In essence, it uses measurable weather data—like rainfall, temperature, or wind speed—as triggers for payouts.
When a predefined weather threshold is crossed (for example, rainfall exceeding a dangerous level for a set period), the system automatically releases compensation. This process enables faster and more objective claims processing, getting money into the hands of farmers when they need it most.
A Proven Model: Success in Vietnam
This parametric model has already been successfully deployed in Vietnam. There, WII is available through MobiFone’s agricultural app, MobiAgri. By embedding Igloo’s Rainfall Weather Index Insurance into the app, the initiative helps farmers manage climate risks and promote sustainable farming.
Bringing the Solution to the Philippines
“We believe the same model can be applied to the Philippines, where frequent typhoons and prolonged droughts continue to impact agricultural productivity,” said John Chen, Igloo’s Country Manager. The company has been in talks with local stakeholders to introduce this type of coverage.
“With the right partners, including government agencies to agritech platforms, we can bring insurance closer to Filipino farmers,” Chen added. Ultimately, the goal is to equip them with the tools to better withstand the effects of climate change.
Learn more about Igloo’s products by visiting iglooinsure.com.
