More than 5,000 maize farmers in Nandi County have received a Sh12 million initial insurance payout for crop losses during the 2021 season.
The payment was made by APA Insurance on behalf of the Kenya Agriculture Insurance Group (KAIG) in partnership with Apollo Agriculture and Pula.
APA Insurance is the lead insurer, Apollo Agriculture is the client, and Pula is the service provider and did risk assessment to determine the claims for the smallholder farmers.
It is the first time that farmers in the region are receiving compensation for failed crops due to climate change, as index-based insurance continues to pick in the country.
“The government has identified agriculture insurance as part of the broader risk management program and a key strategy to de-risk agriculture,” said Ashok Shah, CEO Apollo Group.
More than 75 per cent of Kenyans rely on agriculture at various production and value addition levels for their livelihood. The sector directly employs more than 40 per cent of the total population with more than 70 per cent of Kenya's rural people leaving off agriculture
The sector directly contributes 26 per cent of the GDP and another 27 per cent of GDP indirectly through linkages with other sectors.
Agriculture insurance was first introduced in Kenya by the colonial government in 1942 under the Guaranteed Minimum Return scheme that covered selected crops.
In 2016 the government launched the Kenya National Agricultural Insurance Program, designed to address the challenges occasioned by drought, floods, pests and other natural calamities.
The program was designed as a partnership between the government and the private sector. It was developed with assistance from the World Bank and builds on the experience of similar programs in Mexico, India, and China.
