drought insurance

Drought insurance is a financial product that helps farmers and businesses manage the economic risk caused by severe or prolonged dry periods. It provides payouts if rainfall or soil moisture levels fall below certain thresholds, compensating for income losses due to crop failure or reduced productivity. This type of insurance is often linked to weather data or specific indicators, allowing policymakers or insurers to quickly support affected parties without lengthy claims processes. In essence, drought insurance offers a safety net, helping stakeholders recover more swiftly from the financial impacts of drought conditions.