Kenya could see a significant improvement in its food security efforts by leveraging financial technologies to boost uptake of agriculture and climate risk insurance among smallholder farmers.
According to speakers at a three-day workshop in Nairobi seeking to address critical gaps in agricultural and climate insurance solutions, lack of financial safety nets hinder smallholder farmers from accessing credit, stifles investment in better technology and seeds, and ultimately traps rural communities in cycles of poverty.
“Together, we must shift agriculture insurance in Africa from being perceived as pilot or donor-driven initiatives to becoming a mainstream, sustainable line of business that protects farmers and supports food security,” said Dr. Phocas Nyandwi, African Reinsurance Corporation (Africa Re) Regional Director, Nairobi Office.
Data by the corporation indicate that only 2pc of farmers in Africa, and under 1pc in Kenya have insurance cover leaving millions exposed to climate related shocks.
The workshop by Africa Re in partnership with the International Finance Corporation (IFC) seeks to shift agriculture insurance from donor-led pilots to a sustainable, mainstream line of business targeting regulators, insurers, finance institutions, and technology innovators.
“Our focus is on catalysing the market by supporting the creation of innovative, private sector-led insurance solutions. When we successfully de-risk the farmer, we de-risk the entire value chain. This partnership with Africa Re is critical to building that foundation, unlocking investment, and ensuring East Africa’s agricultural sector can not only survive but thrive in a new climate reality,” said Sanjay Kalpage, Senior Financial Specialist at IFC.
The workshop which ended on Thursday sort to tackle insurance penetration challenges by accelerating the development of affordable, tech-driven insurance solutions that can finally reach millions of smallholder farmers across the continent.
