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Lemonade, a top American insurance company, has revealed the formation of the Lemonade Crypto Climate Coalition meant to offer blockchain-enabled climate insurance to the most vulnerable farmers across the globe.
Through its nonprofit organization dubbed the Lemonade Foundation, Lemonade has partnered with other companies like Chainlink, Avalanche, DAOstack, Hannover Re, Tomorrow.io, Pula, and Etherisc as founding coalition members.
Based on the Lemonade Foundation’s objective of rendering environmental and social change through technology, the coalition is being established as a Decentralized Autonomous Organization (DAO) to create and distribute parametric and instantaneous weather insurance to livestock keepers and subsistence farmers in emerging markets.
The climate insurance will be developed on Avalanche’s proof of stake (PoS) as a stablecoin-denominated decentralized application (dapp).
With the initial rollout expected in Africa this year, farmers will have the ability to make and receive payments using local currencies or stablecoins.
Daniel Schreiber, a director at the Lemonade Foundation, welcomed the collaboration and stated:
“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.”
With Africa having nearly 300 million smallholder farmers who face real climate risks, Rose Goslinga believes blockchain-powered climate insurance will come in handy in safeguarding their livelihoods.
The co-founder of Kenya-based insurtech Pula added:
“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.”
Blockchain is emerging as one of the sought-after technologies for tackling climate change. For instance, Samsung Electronics announced plans to utilize blockchain in a climate-focused reafforestation program in Madagascar earlier this year.
Image source: Shutterstock
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