Chainlink will offer distributed weather data to Arbol, a farming insurance startup. The company’s main beneficiaries are enterprises and small to medium farmers. Arbol enters into smart contracts and provides farmers crop insurance.
Arbol pays claims to subscribers whenever the actual weather values are different from what is specified in the contract. This is more commonly known as parametric insurance and its financial derivative is generally used to buffer losses in agriculture from the adverse effects of future events such as a bad harvest.
Arbol has now partnered with Chainlink oracles and will get live weather coverage on the Blockchain. Anyone with an Internet connection can get access to Blockchain implemented weather reports based on weather data. Generally, weather data and forecasts are notoriously unreliable and added with fraud, corruption, and delays, the authenticity of traditional insurance agreements cannot be counted on.
However, by entering into a strategic partnership with Chainlink and leveraging smart contracts on the Ethereum Blockchain for data feeds, Arbol can eliminate the many downsides of insurance contracts. Farmers can focus more on expanding their operations, safe in the knowledge that they are covered against any form of adverse weather conditions.
Arbol Founder and CEO Siddhartha Jha is quite optimistic about the Chainlink integration. He says,
Being on the Blockchain has many advantages too. The decentralized structure of the Blockchain ensures that the execution of the smart contracts and data in the nodes cannot be tampered with by any external influence. This gives farmers and businesses who are most affected by weather fluctuations something to trust in and helps them to confidently face any possibilities of weather risks. Through the tie-up with Chainlink, Arbol is radically changing how the insurance industry functions and protecting the principal players from risk.
The decentralized oracle network and Chainlink are used by Arbol to link the smart contracts to rainfall datasets which are provided by the National Oceanic and Atmospheric Administration (NOAA) and others. Hence the common inefficiencies of insurance contracts are eliminated through a world-wide marketplace for weather risk built on the Ethereum Blockchain.
