The poor across the world is very vulnerable to floods and drought disasters and have a detrimental effect on the lives and livelihoods of the poor. Weather based index insurance is one of the ways of dealing with these disasters. Protecting against floods and providing risk cover against losses due to floods has been a major area of concern for any government. Risk transfer through insurance is an important component in managing agricultural risks from extreme flood events. The study developed the first of its kind of designing and implementation of an index-based flood insurance (IBFI) product with the advanced use of satellite data and flood models to estimate crop losses due to floods. IBFI insurance product uses two different data elements, the first one is based on the flood model using HEC-HMS and HEC-RAS that uses inputs from NASA GPM bias-corrected satellite rainfall estimates, observed water level and discharge data, river characteristics, and digital elevation model to generate flood depth and flood duration to develop pre-determined thresholds based on the historical flood events between 1991 to 2015 and the second IBFI product uses only satellite data from NASA MODIS Terra and Aqua satellite data and the Copernicus Sentinel-1 SAR data to generate flood depth and flood duration to develop pre-determined thresholds based on the historical flood events and economic losses. More than 7,000 farming households in Bihar (India) and northern Bangladesh have signed up for a pilot IBFI scheme, which went live in 2017. The participating farmers have received insurance compensation for crop losses of over USD 160,000. In addition to the insurance product implementation, the research evaluated the farming willingness to pay, developing business models for scaling; social equity, and economic benefits of derisk disasters. IBFI initiative promotes a closer linkage between risk transfer and risk reduction that could make this more sustainable and robust financial instruments for flood-affected communities and reducing the burden of post-disaster relief funds for the government. In summary, the index insurance using open-access satellite imagery is a win-win opportunity as it brings down the data development cost, lower insurance premium, quick settlement, and greater transparency among various users.