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Farmers who were compensated by Pula microinsurance firm for low yields listen during a forum at Thiba ACK Parish on Friday. [Joseph Muchiri, Standard]

Business News
3,000 farmers from Kirinyaga and Embu counties received Sh9.7 million compensation.

The future of many small-holder farming ventures in Kenya is unpredictable due to the vagaries of weather and infestations by pests and diseases.

Pests such as the ravaging fall army worm, insufficient rain and dearth of agronomical advice has seen many farmers struggle with reducing yields or even losses.

However, a ray of hope beams for many such farmers in the form of a micro-insurance that compensates them for the low yields.

The product initiated by microinsurance firm, Pula and its partners such as Ulima and various agro-input firms takes effect when a farmer purchases certain brands of fertiliser, seeds or other input from select agro vets.

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The cost of the micro-insurance is included in the input or borne by the manufacturer hence no direct charge on the farmer.

Though the global micro-insurance industry stands at Sh64 billion according to a 2019 report by market research firm IMARC Group, the concept is rare in Kenya due to logistical challenges. Developed four years ago, Pula serves 1.7 million smallholder farms in a dozen African and Asian countries. 

The product was piloted to about 16,000 farmers in Uasin Gishu, Trans Nzoia, Embu and Kirinyaga Counties last season. The project will be expanded to 16 more counties the coming planting season.

At least 3,000 farmers from Kirinyaga and Embu Counties recorded poor yields and qualified for compensation and were recently awarded Sh9.7 million. The highest compensation to a farmer was Sh130,000.

Pest invasion

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In the pilot project, the farmers were registered for the micro insurance after buying ETG brand of fertiliser made by Falcon Kenya Ltd from select stockists. Their location and contact details were captured and their registration to the Pula platform activated through their mobile phones.

David Karuiru, a beneficiary of the project, received Sh38,500 through his phone as compensation for the poor yields of his maize from his four-acre piece of land.

Karuiru, who is the treasurer at Thiba ACK Parish in Kirinyaga, which also had an acre of maize entered into the programme, said before harvest, project officers visited his farm to quantify his yields based on the general productivity of his area.

“I was informed I qualified for compensation since my farm registered low yields. Many farmers in the locality recorded low yields because last season rains started normally, subsided when maize had already germinated then pounded heavily later,” he explained during a forum at the parish on Friday.

Pula head of sales Ndavi Muia said the initiative is geared towards cushioning farmers from low yields caused by either pest invasion or climatic conditions.

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“The cost of the insurance is borne by the fertiliser manufacturers, so the farmer does not pay any money to be covered, apart from farming using specified agricultural products,” he said.

A manager at Ulima, Job Ochich said the initiative is complimenting the government’s agenda on food security, and also securing many livelihoods.

“The initiative ensures that farmers do not get losses and are getting value for their hard earned sweat. It also helps shield farmers from fake or sub-standard inputs by working with specific stockists we trust,” said Ochich.  

In addition, he revealed, Ulima links farmers with partners who offer soil testing, market linkages and farm mechanisation services at low cost.

Farming Crop failure Insurance Micro Insurance

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