…as NIRSAL, NAICOM, IFC parleys on IBAI
The Federal Government, has said that it is working with a Kenyan firm to develop innovative insurance products for livestock to put an end to the incessant herdsmen and farmers clashes across the country. Speaking at a workshop on Index-Based Agriculture Insurance, IBAI, the Managing Director of Nigeria Incentive-based Risk Sharing System for Agricultural Lending (NIRSAL), Mr. Aliyu Abdulhameed, said that 25,000 farmers have subscribed to the Index Base Agriculture Insurance (IBAI) scheme, to cushion against loss in the agricultural sector and boost the country’s food sufficiency.
Abdulhameed said that in addition to the partnership with the Kenyan firm, the Federal Government had recently signed partnership agreements with a leading Moroccan agricultural insurance as well as a reinsurance company to provide technical support in expanding the range of agricultural insurance products in Nigeria. At the workshop organised by the National Insurance Commission, NAICOM in collaboration with African Reinsurance Corporation and the International Finance Corporation, IFC, the agency affirmed that it liaise with the National Insurance Commission, NAICOM form time to time.
He said, “NAICOM has been instrumental in achieving this feat. Today, we are happy to report that we have an index-based yield insurance product that covers risks from disease, weather, natural disasters and several other external factors. Since the launch of the insurance product, six months ago, over 25,000 Smallholder farmers have subscribed to it.” While welcoming participants to the event, Commissioner for Insurance, Alhaji Mohammed Kari, said Index Insurance is a new concept in Nigeria and in sub-Sahara Africa, adding that it is pertinent to build capacity to enhance progress in the drive to achieve efficiency and effectiveness in underwriting index-based agricultural insurance in Nigeria. He noted that the scheme is tailored-made in support of the Federal Government’s policy on agricultural development and insurance penetration.
He said, “For us as the insurance sector Regulatory Agency desirous of penetration and market growth, we have indeed embraced Index Based Agricultural Insurance as a strategic initiative for insurance penetration and as well, contribution to the development of Agriculture.”
Also speaking, Deputy Managing Director/Chief Operating Officer, African Reinsurance Corporation, Mr. Ken Aghoghovbia, stated that subsidies on Index Products in Agriculture insurance have a lot of promise in the continent, especially as food security is becoming a major concern for policy makers in developing countries.
He further stated that Nigeria had lost its enviable position in agriculture, largely due to a shift in focus whereas several other countries are thriving, buoyed by various models of subsidy. He said, “Agriculture in Africa is generally dominated by smallholder farmers and pastoralists who do not appreciate what insurance can do for their business. Even the ones that do either lack the confidence that insurers will easily settle their claims or can barely afford the insurance premium. At Africa Re, we believe that it is critical to support agricultural self-sufficiency within Africa, and that is why we are working with the International Finance Corporation of the World Bank Group and other stakeholders, to promote agriculture insurance in the continent.”
