Kenyan firm takes crop insurance cover to Rwanda

By Sarah Mortimer

Swiss Re-backed micro-insurance project that provides weather insurance for crops in Kenya has been expanded to Rwanda, the companies involved said yesterday.

The project will offer low-cost insurance to 20,000 farmers in the southern and western provinces of Rwanda to protect them from financial losses against repeated bad weather destroying their crops.

Rwanda endures a tropical temperate climate with irregular rainfall and an economy based mainly on agriculture.

 Micro-insurance insures low-income people against specific perils in exchange for premiums proportionate to the likelihood and cost of the risk involved.

The program, known as ‘Kilimo Salama’, which means ‘safe farming’, was launched in Kenya in 2010 by the Syngenta Foundation for Sustainable Agriculture, the ministry of Agriculture and Animal Resources, One Acre Fund, SORAS Insurance in Rwanda, and Swiss Re Corporate Solutions.

Over 10,000 farmers in Kenya have received payouts from the programme, a statement said.

 Rwandan farmers will pay an insurance premium as part of their loan repayments for fertilizer.

 Claims will be paid out based on data from eight weather stations, which have been installed in the Southern and Western provides.

The weather stations will record weather changes and release updates on rainfall record.

 When the data meets the criteria for a claim, it will trigger a payout to One Acre Fund, which will compensate individual farmers or forgive their loans.

 Kilimo Salama won the Financial Times sustainable Finance Award this year for using the power of finance to  address the scarcity of essential goods across the society.

Currently, UAP is offering indemnity based multi-peril crop insurance and livestock insurance products to a wide range of farming communities in Kenya.

UAP sees index-based insurance solutions as a promising way to offer coverage to the big number of Kenya’s smallholder farmers in the future.                      

   — Reuters