Imagine spending your life’s savings on seed and fertilizer and then losing your entire harvest and investment to a drought or flood.
This is the reality that most small scale farmers in Africa deal with. Climate change has complicated both traditional and scientific weather forecasting methods, making unprepared farmers vulnerable to climatic variability.
Kilimo Salama (Safe Agriculture) is a micro-insurance product designed to enable small holder farmers to insure their farm inputs against unpredictable weather conditions. The product, currently available in Kenya and Rwanda, has been developed through the partnership of Syngenta Foundation for Sustainable Agriculture, UAP Insurance, and the Kenyan telecoms operator Safaricom. It allows farmers to insure as little as one-acre’s worth of farm inputs.
How does micro-insurance work?
When farmers buy inputs from a stocker, they are given the option to insure them for a small premium: about 5% of the retail price. Upon payment of the premium, the farmer receives an SMS text message on their celular phones with the policy number.
Whenever there is crop failure as a result of too little or too much rainfall, the farmer automatically gets paid without having to make a claim. Syngenta Foundation has established a network of weather stations that monitor rainfall in all areas where the insurance product is offered. In the event of drought or flooding, the farmer will receive his payout through mobile-money transfer. The amount of compensation depends on the extent of the drought as measured by the nearest weather station, usually not more than 15 kilometres away.
Is Kilimo Salama the solution for climate vulnerability?
Kilimo Salama’s model of insurance is scalable and replicable throughout Africa, but it cannot be transferred as is. It needs to be tailored to the unique needs of farmers in every country. This requires a number of feasibility studies, all of which will take time.
The current model is also capital intensive as it requires the establishment of a high density of weather stations. Syngenta foundation is currently considering the possibility of using data from weather satellites to determine whether or not there has been a drought or flood.
Lastly, farmers who practice inter-cropping cannot, as of now, benefit from this insurance product. A farmer is required to have at least one acre of the selected crop – maize or wheat in the Kenyan case – before they can qualify for insurance. Syngenta foundation is however working to develop a model that will allow farmers to receive payment regardless of whether they are practicing mono- or inter-cropping.
Despite the challenges to scaling-up, Kilimo Salama has the potential to change the lives of millions of African farmers, many of which may have access to insurance for the first time.
Blogpost by Grace Wanene, a social media reporter for AASW6, with input from Wairimu Muthike, project manager at the Syngenta Foundation for Sustainable Agriculture.
Photo: Crane Station