At European Microfinance Week yesterday, Veronika Bertram-Hümmer of Deutsches Institut für Wirtschaftsforschung Berlin (the German Institute for Economic Research) and Leibniz Universitat Hannover presented research on how insured and uninsured herders in Mongolia recovered from the 2009-2010 drought that killed 22 percent of the livestock in the country. Insured households received an average payout of USD 312. None used the money to buy livestock, instead opting to buy food, pay off loans and improve their livestock shelters. Uninsured households were more likely to sell animals, presumably to offset the negative impact of the drought on their incomes. In terms of rebuilding assets, the effect of microinsurance appeared to be largest after two years, at which time the insured households had an average of 27 percent more assets than those that had been uninsured during 2009-2010.
This story is part of a sponsored series on European Microfinance Week, which is held each November by the European Microfinance Platform (e-MFP), a 125-member network located in Luxembourg. MicroCapital reported live throughout the event.
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