Allianz Africa is eyeing the agriculture insurance sector in
"According to our estimates, Agriculture Insurance Premium globally is
The partnership covers the general insurance business (also known as the property & casualty insurance segment) in
Lovermore says that
"Operationally, parametric solutions are less cumbersome as the insurance company does not need to visit the farm and occupy the farmer's time. Monitoring of the index can be done remotely through satellite imagery and data. The farmer can also have access to the data and they can closely monitor the development of the index throughout the growing season on their mobile phone or tablet. This also makes it very transparent, traceable, efficient, and paperless," said the official.
Through parametrics, farmers can choose which parameter is of concern to them, as far as affecting their crop yield is concerned. The most common parameter is rainfall. Lack of rainfall during the cropping season (drought) as well as too much rainfall (excessive rainfall) have a huge impact on the farmers' yield and subsequently the revenue.
So the farmer will choose to insure against drought and/or excessive rainfall to hedge their losses. When the insurance company uses index insurance solutions such as Rainfall Index, Evapotranspiration Index, Soil Moisture Index, and Area Yield Index, these are classified as parametric solutions.
Over the years, more insurance companies are venturing into the agricultural space as farmers are increasingly understanding the value of insurance as they learn from other people's experiences.
The Kenyan government and private sector are also actively contributing to the insurance penetration through premium subsidies for both crop and livestock farmers as only less than 5% of the
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