Farmers accessing agricultural insurance reach 40,000

Harvest. A farmer in her garden. The Uganda Agriculture Insurance Scheme is premised on making agriculture insurance affordable to all farmers in Uganda. FILE PHOTO

What you need to know:

One year later. The scheme became operational in July 2016.

Purpose. The Agriculture Insurance Premium Subsidy Scheme is a five-year programme which started on July 1, 2016 and Shs5b has been provided for by government.
The general objective of the scheme is to ensure that a Ugandan farmer is largely protected against the effects of agriculture risks.

Kampala. The number of farmers accessing subsidies from government under the Uganda Agriculture Insurance Scheme (UAIS) has increased from 30,000 to 40,000 farmers indicating increased interest in the services.

UAIS, which became operational on July 1, last year, is premised; on making agriculture insurance affordable to farmers in Uganda.
This is addition to and increasing farmers’ access to credit by protecting agriculture loans disbursed by financial institutions from the effects of specified agriculture risks.

Speaking at a training workshop on agricultural insurance last week in Kampala, consortium officer Agro Consortium Uganda Insurers Association John Makosya said farmers are picking interest.

“Since the introduction of the Uganda Insurance Scheme in July 1, 2016 the number of beneficiaries have increased from 30,000 farmers to now 40,000 farmers comprising both the smallholders and commercial farmers, however the majority of the beneficiaries are the smallholders farmers,” he said.
Mr Makosya said insurance products and process under the scheme have been standardised.

“The other achievements we have registered are on the premium rate. At the beginning the premium rate was in the range of 6 per cent to 10 per cent, but now the average is 5 per cent,” he said.
About the absorption rate, Mr Musyoka said not all the Shs5 billion that was budgeted for the scheme has been absorbed.

“Subsidy absorption has been slow, however, we are likely to close at Shs4 billion out of Shs5b by the end of the year,” he said.
He added that currently there are 10 insurance companies and another three companies have expressed interest in joining.
The GIZ advisor financial systems development and insurance, Dr Alexander Jager in an interview with Daily Monitor said the insurance companies in Uganda should design the right product that benefit the farmers.

“All the products provided by the insurance companies must be beneficial to the farmers so that the farmers don’t lose out. At the same time the insurance regulators need to properly check the products the insurance companies are providing,” he said.
GIZ is a Germany organisation funded by Federal Ministry for Economic Cooperation and Development.

Dr Jager said they operate in partnership with Alliance on Climate Risk Transfer Solution to help countries develop capacity in matters of agriculture insurance.
The countries are; Nigeria, Ghana, and Kenya, among others.
“ Kenya we are helping with livestock insurance and we have come to Uganda to see which specific insurance product we provide to the public and the private sector,” Dr Jager said.