Climate insurer Blue Marble and Nestlé have launched a pilot weather insurance programme in Indonesia designed to provide over 800 smallholder coffee farmers with financial protection against unpredictable weather rainfall and drought.
The weather insurance leverages satellite-based climate data to determine when coffee output has been adversely impacted by too much or insufficient rainfall in key phases of the crop cycle.
Payments by the parametric insurance scheme are issued automatically to registered coffee farmers who have been affected, according to the severity of the weather.
The more than 800 smallholder coffee farmers in Indonesia that stand to benefit from the pilot supply coffee to Nescafé, one of Nestlé’s brands.
Marcelo Burity, Global Head of Nestlé’s Green Coffee Development, commented, “This weather insurance helps to establish a support mechanism for smallholder coffee farmers in Indonesia. It allows them to access financial resources to re-establish their crops in the event of irregular weather conditions while building resilience in coffee farms.”
Jaime de Piniés, CEO of Blue Marble, added, “Smallholder coffee farmers in Indonesia are vulnerable to climate risks and need access to insurance to protect against extreme weather events.
“We are proud to partner with Nestlé and its brand Nescafé to develop innovative ways to support the climate adaptation of smallholder coffee farmers and their families.”
Serving as an integral part of the Nescafé Plan 2030, the initiative supports the brand’s vision of the long-term sustainability of coffee and to help improve farmers’ livelihoods.
Depending on the results of the pilot, Nestlé will determine the expansion of the scheme to other Nescafé sourcing locations.
In 2019, Blue Marble, a consortium of nine companies including Zurich, AIG, Aspen, and Hamilton, renewed and expanded its weather index insurance programme for smallholder coffee farmers in Colombia.
This programme was launched in 2018 in collaboration with Nespresso, an operating unit of the Nestlé Group.