Household profiles and resilience indicators for climate risk transfer in Sri Lanka

This research conducted by SLYCAN Trust aims to identify key indicators to assess and track the resilience of farming households as well as the impact of risk management, risk transfer, and risk finance interventions. The agriculture sector is a vital part of Sri Lanka’s economy and provides employment for approximately a quarter of the country’s workforce. However, the sector is facing increasing climate risks that affect crop yields, livestock production, livelihoods, health, wellbeing, and lives of smallholder farmers, supply chain actors, and rural communities.

There are many opportunities to strengthen risk management among Sri Lankan farming households. Currently, households in the research areas have a low level of economic diversification, implement only a limited adaptation or risk management measures, and have low insurance coverage besides the government-provided public crop insurance scheme, which only covers selected crops and is indemnity-based in nature. Key indicators for livelihood resilience profiles have been developed through this scoping survey and a participatory consultation process. The indicators collect data across seven main areas:

• Livelihood diversification;

• Risk management;

• Financial inclusion;

• Insurance penetration;

• Demand side linkages;

• Supply side linkages; and

• Access to information.