News / Africa

Insurance Initiative Could Protect Farmers Against Drought in Kenya

With the news of a coming drought looming over east Africa, small farmers walk a thin line between survival and ruin. But a new micro-insurance program could provide some measure of stability for residents in country's driest areas

A herder in Kenya tends to his cattle, Aug 2010
A herder in Kenya tends to his cattle, Aug 2010

Multimedia

Michael Onyiego

In Kenya, the specter of drought is never far from the minds of the millions who make their living on the farm.  

Agriculture is Kenya's most important product.  The industry employs nearly three quarters of the country's workers and accounts for almost one fifth of the nation's gross domestic product.

Drought threatens the livelihoods of tens of millions in Kenya, but those most at risk are the millions who farm simply to survive.  For those farmers, drought is both an economic risk and a life threatening event.  

Many subsistence farmers in Kenya invest their life savings into each harvest, and a single season of light rain can set a family back for years.  

In 2007, unusually low rainfall triggered a food shortage, sending food prices up and prompting calls for price controls.  The effects of that drought continued through late 2009, when unusually heavy rains provided a rare surplus for the country.  

In east Africa, serious drought is expected about once per decade.  But recent reports of a La Nina weather system in the Pacific have many predicting yet another season of insufficient rain.  

To protect against such uncertainty, small farmers often plant different seed varieties to guarantee at least some returns on their investment.  Planting different types of drought resistance crops can help cover risk, but lead to reduced yields and keep farmers living from season to season.  

Harvest insurance can protect against crop failures, but such services are expensive and typically unavailable to farmers.  Insurance premiums can reach thousands of dollars, while many small farmers invest less than $100 in each season's crop.  Small farmers often work in remote areas, making site visits by insurance companies difficult and expensive.

But through a new partnership between UAP Insurance, telecommunications firm Safaricom and Swedish non-profit Syngenta, Kenyan farmers can buy insurance on seed and fertilizer to protect against potential losses.

The product, called Kilimo Salama - which means "safe agriculture" in Swahili - harnesses mobile technology and new agricultural technology to provide insurance on a smaller scale.

Instead of insurance inspectors, Kilimo Salama has installed stations across the country that measure weather patterns and predict how harvests will be affected.  These unmanned stations wirelessly transmit data to a central database that is used to calculate losses and distribute payments to farmers.

According to Sygenta spokesperson Rose Goslinga this method, known as weather indexing, provides an efficient and cost effective way of calculating risk on small farms.

"That weather station measures what goes on, on the farmers' fields and is essentially a representation of the insurance.  So you do not have to send anybody to go and check what happens on the farm," she said. "This means you reduce your transaction costs.  Instead of having to go and visit, you now can see 100 farmers, who all maybe have one acre and measure what goes on, on their farm."

Another unique aspect of the insurance is the way in which farmers are paid.  When weather stations detect a potential crop loss, insurance payments are automatically made to farmers via mobile phone.

The product utilizes Safaricom's heralded M-Pesa service, which allows customers to send and store money with mobile phones. On July 21, Kilimo Salama made its first payouts via M-Pesa.  The average payout was around $22, though some were as small as $1 and others as large as $3,500.  

Through mobile phones, Kilimo Salam also provides updates to farmers as well as tips for growing crops in challenging regions.  

Kilimo Salama is still in development, but the program appears to be catching on.  First launched in 2009, around 200 farmers were insured.  This year, the program covers approximately 11,000 farmers across Kenya.

A farmer from Siakago in Kenya's Eastern Province, Lydia Njagi, first tried Kilimo Salama insurance out of curiosity.

Njagi says she initially insured around $5 worth of seed before the current growing season.  After weather stations predicted a 15 percent reduction in crop yields Njagi received an initial payment of around one dollar, with more to come if the weather trends continue.  Njagi told VOA she was initially skeptical of the product, but would insure more of her crop for the next season.

Many of Siakago's farmers told VOA they were happy with the Kilimo Salama program, and many more could be seen lining up to purchase the insurance for the first time.

While the insurance program is only available for seed and fertilizer produced by brands certified by the group, Goslinga told VOA the group planned to expand the project and open it up to other producers in the future.

Kilimo Salama has 30 weather stations that cover climate zones about 15 to 20 kilometers in area.  Only five areas in Kenya are currently covered, but the group hopes to build an additional 50 stations this year to cover more farmers by the start of the next season.

You May Like

Video Miami Cubans Divided on New US Policy

While older, more conservative Cuban Americans have promoted anti-Castro political movement for years, younger generations say economically, it is time for change More

2014 Sees Dramatic Uptick in Boko Haram Abductions

Militants suspected in latest mass kidnapping of over 100 people in Gumsuri, Nigeria on Sunday More

Video Cuba Deal Is Major Victory for Pope

Role of Francis hailed throughout US, Latin America - though some Cuban-American Catholics have mixed feelings More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Sudan School Becomes Target of Aerial Attacksi
X
December 19, 2014 12:45 AM
The school dropout rate is at an all-time high in Sudan's South Kordofan state because many schools have been destroyed during the three-year civil war between the government and SPLA-N rebel forces. Adam Bailes visited Sudan's Nuba Mountains' region and reports many children are simply too scared to go to school
Video

Video Sudan School Becomes Target of Aerial Attacks

The school dropout rate is at an all-time high in Sudan's South Kordofan state because many schools have been destroyed during the three-year civil war between the government and SPLA-N rebel forces. Adam Bailes visited Sudan's Nuba Mountains' region and reports many children are simply too scared to go to school
Video

Video VOA Reporter Tours Devastated Peshawar School

Islamist militants wearing military uniforms and strapped with explosives attacked a military run school Tuesday in the northwestern Pakistani city of Peshawar. At least 141 people were killed in the horrific attack, most of them young students. VOA reporter Ayaz Gul visited the devastated school and attended the funeral of the principal who courageously tried to save her students from the deadly attack.
Video

Video Nigerians Fleeing Boko Haram Languish in Camp Near Capital

In its five-year effort to impose Islamic law in northeastern Nigeria, the Boko Haram extremist group has killed thousands of people and forced hundreds of thousands to flee. Some of those who ran for their lives now live in squalor on the edges of the capital, Abuja. Chris Stein reports for VOA.
Video

Video Putin Says Russian Economy Will Emerge Stronger

Russian President Vladimir Putin has said his country's sinking economy will not only recover but also become stronger, despite falling oil prices and Western sanctions over Ukraine. VOA's Daniel Schearf reports.
Video

Video Detained Turkish Journalists Follow Teachings of US-Based Preacher

The Turkish government’s jailing of critical journalists has sparked international condemnation and is being seen as an effort to undermine the followers of an ailing Turkish preacher based in the United States. VOA religion reporter Jerome Socolovsky has more.
Video

Video ‘Anti-Islamization’ Marches Increase Tensions In Germany

Anti-immigrant rallies in Germany have been building in recent weeks, peaking Monday night in the city of Dresden where tens of thousands of people turned out to demonstrate against what they call the ‘Islamization’ of the West. Germany has offered asylum to more Syrian refugees than any other country, and this appears to have set off the protests. Henry Ridgwell reports from London.
Video

Video Aceh Rebuilt Decade After Tsunami, But Scars Remain

On December 26, 2004 there was an earthquake in the Indian Ocean so powerful it caused the Earth’s axis to wobble a few centimeters. Onshore on the island of Sumatra, the resulting tsunami was devastating. A decade later, VOA Correspondent Steve Herman reports from Banda Aceh, Indonesia, where although there is little remaining evidence of the physical devastation, the psychological scars among survivors remain.
Video

Video Refugees Living in Kenya Long for Peace in the Home Countries

Kenya is host to numerous refugees seeking safe haven from conflict. Immigrants from Somalia face challenges in their new lives in Kenya. Ahead of International Migrants Day (December 18) Lenny Ruvaga has more for VOA News from the Kenyan capital.

All About America

AppleAndroid