Kenyan farmers to benefit from innovative cover programme
The Government of Kenya has launched the Kenya National Agricultural Insurance Program, which is designed to address the challenges that agricultural producers face when there are large production shocks, such as droughts and floods.
The program, which is designed as a partnership between the government and the private sector, was developed with assistance from the World Bank Group and builds on the experience of similar programs in Mexico, India, and China. One program line will focus on livestock insurance, while another will focus on maize and wheat insurance.
‘The large majority of the poor in Kenya are farmers, so this program has the potential to have a significant impact on Kenya’s economic development. This program aims at improving farmers’ financial resilience to these shocks and will enable them to adopt improved production processes to help break the poverty cycle of low investment and low returns,’ says Diarietou Gaye, World Bank Country Director for Kenya.
in the Northern Arid and Semi-Arid Lands. Through the new Kenya Livestock Insurance Program (KLIP), the government will purchase drought insurance from private insurance companies on behalf of vulnerable pastoralists. Satellite data is used to estimate the availability of pasture on the ground and triggers payouts to pastoralists when availability falls. KLIP was introduced in October 2015 for 5,000 pastoralists in Turkana and Wajir and is envisaged to be scaled across the region by 2017.
For maize and wheat, production shocks such as droughts and diseases pose similar challenges to producers. These risks also diminish banks’ appetites to lend to farmers to improve their farming technology and productivity.
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