Lemonade Foundation launches blockchain parametric insurance
The Lemonade Foundation, a non-profit founded by Lemonade Insurance, announced the Lemonade Crypto Climate Coalition, a Decentralized Autonomous Organization that is working to build and distribute parametric weather insurance to farmers and livestock keepers.
The coalition, which is working to determine weather risk, automate claim assessment and provide funding and reinsurance, includes members from Avalanche, Hannover Re, Pula, Tomorrow.io, Chainlink, DAOstack and Etherisc. The insurance will initially roll out, sometime in the next year, in Africa.
“The Lemonade Foundation was established to build exponentially-impactful technologies,” said Daniel Schreiber, director at the Lemonade Foundation, in a statement. “By using a DAO instead of a traditional insurance company, smart contracts instead of insurance policies, and oracles instead of claims professionals, we expect to harness the communal and decentralized aspects of web3 and real-time weather data to deliver affordable and instantaneous climate insurance to the people who need it most.”
The insurance will be stablecoin-denominated or valued based on traditional currencies like the U.S. dollar. It will be a decentralized application on Avalanche, a smart contract platform for the blockchain industry. Farmers will be able to make and receive payments in local currencies or stablecoins using their phone
“Africa has an estimated 300 million smallholder farmers. The majority face real climate risks to their livelihoods, as traditional, indemnity-based insurance is often unaffordable or unavailable to them,” said Rose Goslinga, co-founder of Pula, a Kenya-based insurtech that specializes in digital and agricultural insurance to de-risk millions of smallholder farmers across Africa, in a statement. “This is where the power of the Lemonade Crypto Climate Coalition comes in: An on-chain solution that can be immediately impactful at scale will allow farmers to finally get financially protected against the increasingly frequent risks such as drought.”
The Lemonade Foundation is providing initial capital to support the DAO smart contracts.
