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Global insurance markets are vast and diverse, and may offer many opportunities for remote sensing. To date, however, few operational applications of remote sensing for insurance exist. Papers claiming potential application of remote sensing typically stress the technical possibilities, without considering its contribution to customer value for the insured OPEN ACCESS Remote Sens. 2014, 6 10889 or to the profitability of the insurance industry. Based on a systematic search of available literature, this review investigates the potential and actual support of remote sensing to the insurance industry. The review reveals that research on remote sensing in classical claim-based insurance described in the literature revolve around crop damage and flood and fire risk assessment. Surprisingly, the use of remote sensing in claim-based insurance appears to be instigated by government rather than the insurance industry. In contrast, insurance companies are offering various index insurance products that are based on remote sensing. For example, remotely sensed index insurance for rangelands and livestock are operational, while various applications in crop index insurance are being considered or under development. The paper discusses these differences and concludes that there is particular scope for application of remote sensing by the insurance industry in index insurance because (1) indices can be constructed that correlate well with what is insured; (2) these indices can be delivered at low cost; and (3) it opens up new markets that are not served by claim-based insurance. The paper finally suggests that limited adoption of remote sensing in insurance results from a lack of mutual understanding and calls for greater cooperation between the insurance industry and the remote sensing community.

Trees on farms are a widespread feature of landscapes across a large part of Ethiopia with an important role in enhancing the resilience of smallholder livelihoods through the provision of ecosystem services. Despite their importance, little is known about what trees are planted or retained from natural regeneration by different types of farmers that results in the pattern of tree cover found in the region. We address this knowledge gap through analysis of household survey data from semi-arid and sub humid areas of Oromia regional state. A set of composite variables that represent distinctive patterns of tree cover on farms were derived from principal component analysis and Pearson correlation analysis. This revealed two major tree adoption strategies: farmer managed natural regeneration (FMNR) of trees to meet subsistence needs as well as contributing to other ecosystem services; and, high value agroforestry (HVAF) involving planted trees used largely to produce fruits, timber and fodder. Regression analysis further identified fine-scale variation in ecological and socio-economic factors that affect which of these two broad strategies are adopted by farmers. Favorable climatic conditions coupled with institutional arrangements to control free grazing were pre-conditions for HVAF, whereas poor biophysical potential and sloping land provided a positive incentive for farmers to adopt FMNR. Farmers with preferences for tree species with multiple utilities and locational flexibility favored FMNR while adoption of HVAF was more assetdriven. Our findings reveal that farmers integrate many native and exotic tree species on their farms to meet their variable farm conditions, needs and asset profiles in stark contrast to most tree promotion efforts that focus on a few, usually exotic, tree species. We recommend that future agroforestry promotion should embrace a diversity of tree species appropriate to matching the fine scale variation in ecological conditions and farmer circumstances encountered in the field.

Implications of changes in traditional Faidherbia albida based land use systems on productivity were investigated in Tigray, northern Ethiopia. The relation between F. albida based-land use systems and crop productivity was explored in 77 fields and 81 farms at field and regional scales, respectively. Barley yield and soil fertility increased when field locations were closer to a F. albida trunk in the F. albida alone (AA) and F. albida + livestock (AL) land use systems. However, the F. albida + Eucalyptus camaldulensis (AE) land use system showed a decreasing trend in barley yield and soil fertility as distance from a F. albida trunk decreased. At regional scales, higher F. albida tree density per farm and sparsely cultivated land use types were associated with increased potential ecosystem services (barley yield). This study suggests that local biodiversity components (e.g. F. albida trees) can increase crop yield and soil fertility significantly when grown within and around farm lands. This study contributes to the knowledge on agricultural productivity enhancement by developing an approach to scaling up from farm to regional level.