In Pakistan, millions of smallholder farmers face recurring losses from climate shocks like floods and droughts. While traditional loan insurance products exist, they often miss the mark—protecting only the lender, not the farmer.

In a recent podcast discussion, Michael J. McCord shared the MicroInsurance Centre at Milliman’s (MIC@M) approach to using microinsurance as a step towards improving the resilience of smallholder farmers against climate change.

Here’s what sets this approach apart:

• It shifts the focus from repaying loans to protecting lives and livelihoods.
• It considers indirect losses—such as loss of income or inability to work after a disaster.
• It supports families who farm or raise livestock on land they may not legally own or document—acknowledging the realities of informality in rural economies.
• It encourages behavior change, like taking early action through accessible warning systems before a flood hits.

This kind of product isn’t just about recovering after disaster—it’s about giving farming families the confidence to plan ahead and invest in the future.

If you're interested in hearing how microinsurance can evolve to meet climate challenges with examples from MIC@M's recent agriculture insurance pilots with SAFCO, listen to the full podcast here.