IBLI threshold update in Mongolia lowers the first insurance level to 5 percent, marking a key step in livestock protection. Consequently, herder households now have improved coverage against severe losses due to extreme weather and natural disasters.
The Government of Mongolia approved the revised IBLI threshold during its regular session on February 4, 2026. The change applies to the 2026-2028 insurance period and defines insured events and risk allocation more precisely.
Earlier, the government drafted amendments to the Index-Based Livestock Insurance in January 2025. These amendments were approved by the State Great Khural in December 2025, reducing the legally prescribed threshold from 6 percent to 5 percent. As a result, the first insurance threshold was recalculated based on updated actuarial assessments.
The IBLI program has a long history in Mongolia. Initially launched in cooperation with the World Bank from 2005 to 2014, the program aimed to protect livestock, the primary source of income for herder households, from dzud and other unexpected risks. Since its adoption in 2014, the IBLI framework has regulated domestic and international reinsurance, compensation payments, and risk sharing.
“Mongolian National Reinsurance” JSC manages nationwide IBLI operations. Officials said the lowered threshold strengthens herders’ access to insurance and encourages broader participation in the program. The update reflects ongoing efforts to improve resilience against climate-related risks in Mongolia’s pastoral economy.
Experts noted that lowering the threshold could increase the number of eligible claims while maintaining financial sustainability. They said actuarial calculations ensure that the insurance fund can handle payouts without threatening program stability. Consequently, the update balances protection for herders with long-term viability of the insurance scheme.
The IBLI threshold update also aligns with broader social and economic goals. By mitigating losses from natural disasters, the program helps stabilize rural incomes and supports national food security. Analysts emphasized that effective insurance coverage is increasingly important as climate volatility intensifies.
Looking ahead, government officials plan to monitor the program closely and may adjust future thresholds to reflect changing risk patterns. They also aim to promote awareness among herders about insurance benefits and encourage participation across Mongolia’s vast pastoral regions.
In conclusion, the IBLI threshold update strengthens Mongolia’s livestock protection system. By lowering the first insurance threshold, herders gain better coverage against dzud, extreme weather, and other unforeseen events, improving both economic resilience and social stability.
