The Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL) has said it is targeting to get agric insurance product to 3.6 million farmers to hedge them against pre-harvest losses.
Already 1,476,289 smallholder farmers have subscribed to NIRSAL Plc’s insurance products in the past farming seasons.
The NIRSAL Plc Managing Director/CEO Mr Aliyu Abdulhameed disclosed this during the official launch of the Hybrid Multi-Peril Crop Indemnity-Index Insurance product (HM-II) in Abuja.
He said the HM-II is a product developed in partnership with Royal Exchange Insurance. The first-of-its-kind product protects farmers from losses during a planting season caused as a result of bad weather in the form of low & high rainfall, early & late season dry spells, lightning, hailstorms and thunderstorms.
It also guards farmers against pest outbreak, disease outbreak, fire outbreak and permanent disability or death of a farmer.
He also explained that “as part of the HM-II, in a case where the afore-mentioned risks materialize, benefits paid out to the farmer would be up to the maximum loan or the insured amount following the trigger from advanced satellite technology or an assessment by an Agriculture expert or both.”
Mr. Abdulhameed thus projected that “NIRSAL Plc aims to increase the distribution of existing and new Agric insurance products from about 0.5 million farmers in 2017 to 3.6 million farmers nationwide by 2026.”
This new product he said it is an improvement on the index-based Insurance product- the NIRSAL Area Yield Index Insurance product (AYII), which guarantees the income of the smallholder farmer by covering the expected yield. AYII was piloted during the 2017 wet season farming to great effect; covering 17,000 farmers and 10,000 hectares with a harvest value of N3bn. He said NIRSAL has a consortium of 10 insurance companies it is working on the insurance products.
In his remarks, Mr. Benjamin C. Agili, the Managing Director/Chief Executive, Royal Exchange General Insurance Company promised he will not default in claims. He added that the product is unique because it insures both the farmer and his or her farm. “This unique product seeks to protect the small-holder farmers from farming loss during a particular farming season and has gone a step further by insuring the life of the farmer during the season in case of permanent disability or death, during the season, thereby ensuring the farmer is able to remain in business, no matter the loss or situation.”
The regulator, the Commissioner of Insurance and CEO/NAICOM Mr, Sunday Thomas said the Commission is in full support of the partnership.
Represented by a director in the Commission, Mr. Leo Aka, the NAICOM CEO said “the operations of both organizations would ensure the distribution of the product to smallholder farmers to help them build resilience against climate risks and enhance food security as NIRSAL continues to provide access to finance for smallholder farmers.”
“Today we are taking the right steps towards the expansion of a new business frontier not only for agro-insurance sector but also the development of our economy,” he noted.