Can Mobile Micro-Insurance be used as a Tool for Poverty Reduction?

Addressing the financial needs of the poor is increasingly seen as a necessary step on the way out of poverty. Mobile telephony is revolutionizing access to financial services in developing countries. What is the potential of micro-insurance to reduce vulnerability of poor rural households? Can mobile phones enable the provision of these kinds of services? This study seeks to understand the impact of the provision of micro-insurance through mobile phones on poverty reduction. Through the analysis of Kilimo Salama in Kenya, the paper concludes that these kinds of interventions can help reduce the poverty of poor rural households by reducing their vulnerability to weather shocks, improving their yields, and improving their access to finance.