Why Farmers Need To Insure Their Crops and Livestock

When most people think about insurance covers, what usually comes to mind are motor and health covers. However, did you know that farmers can also insure their crops or livestock?

At Kilimo Insight, we purpose to heighten the accessibility of agricultural information that helps farmers boost productivity and enhance food Security in the country. Accordingly, this article is on the basic information on Agriculture Insurance and how it benefits the farmer.

What is Agriculture Insurance?

This refers to the protection a farmer can get from insurance companies for their crops and livestock in case of a calamity. It involves policies that provide the farmer with coverage against crops or livestock loss through probable eventualities such as drought, floods, pests & diseases, theft of produce or injury to livestock, fire, instances of political instability among others.

Farmers pay an amount called a premium to an insurance firm to compensate them whenever they incur losses.

Insurance companies provide customizable insurance solutions, depending on the size, type and needs of the farmer. This gives the farmer liberty to choose insurance companies that offer covers that best suit their needs.

Farmers can apply for crop, livestock, horticulture and floriculture or tree crop insurance. Depending on the insurance company and the policies they have, these covers can be divided into contract seed grower insurance, loan-linked, dairy and livestock, replanting guarantee etc. Farm assets and equipment including green houses and irrigation facilities are also covered.

Why is it important for farmers to have insurance covers?

  • Yield and livestock protection

A crop insurance plan ensures stabilization of crop production and protects the farmer against loss of crops, produce or livestock.

Initially, companies offered covers for dairy cattle only. Lately, however, there are insurance covers for pastoralists; who largely keep cattle, sheep, goats, camels and donkeys.

  • Stability in income

Insurance covers act like a tool that allows farmers to manage their yield and price risks. It ensures that farmers are compensated and still earn in the event of a disaster.

  • Minimal debt

Insurance covers ensure that farmers are able to repay their loans. For instance, in the recent past, locusts have destroyed crops in many parts of the country.

In an event that a farmer had taken up a loan to finance their production but ended up losing their crops to locust invasion, the insurance company helps repay the loan; as this is a situation that was not anticipated by the farmer.

Moreover, farmers with agriculture insurance have greater access to agriculture credit because financing institutions accept an agriculture policy document as an alternative form of Security.

Kenya’s agriculture is 98 per cent rain-fed, making it highly vulnerable to climatic hazards such as droughts and floods.

Year in year out, the country suffers food shortages; as thousands of acres of crops are destroyed as a result of these climate hazards.

Food inSecurity can also be impacted by other factors such as; diseases and pests like army worms–which in the past have caused massive food crisis, political instability and long electioneering period as witnessed during the last elections in 2017, or pandemics such as the corona virus which is currently wreaking havoc on the Kenyan economy and threatening food Security in the country.

Farmers with Agriculture Insurance are more likely to get back on their feet within a short period of time. Despite the losses incurred, they can access farm inputs and other supplies for crop production.

This eventually ensures the country’s food Security.


Susan Nderitu

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