A Case for Livestock Insurance
This case study discusses the implementation of a livestock insurance product by IFFCO-TOKIO, India. It outlines how IFFCO-TOKIO improved value for clients through new business processes. The study demonstrates that if administered carefully livestock insurance has the potential to be viable with scale. IFFCO-TOKIO is a joint venture between the Indian Farmers Fertilizer Cooperative Ltd (IFFCO) and Tokio Marine and Nichido Fire Inc. of Japan (TOKIO). IFFCO-TOKIO identified need for livestock insurance among rural farmers but was wary of the challenges facing the sector. Encouraging results from IFFCO-TOKIO's pilot implementation of livestock insurance highlight the need to adapt processes, learn from the field, and balance client value and business viability. The case also highlights the importance of having champions across the value chain. Going forward, IFFCO-TOKIO needs to:
- Find a way to scale, expand, and become viable;
- Manage the expansion of the program while maintaining the same level of control over the system;
- Modify its processes and introduce more decentralized decision-making;
- Track the variations in the claims and expense ratios as new approaches are tested.