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Kenya: Farmers may soon receive first drought payout

Nairobi — Insurers will assess in October whether Kenyan farmers signed up to the Index-Based Livestock Insurance scheme will receive their first payment, after the worst drought in the region for 60 years.

The scheme, which has been piloted in northern Kenya since early 2010, uses freely-available satellite data to assess the state of pastures. When the images show that pastures have dried up, farmers can claim compensation for animals that have died as a result – without insurers having to verify the deaths in person.

In Kenya about 2,500 farmers have purchased the product since its inception, paying a yearly premium of up to US$100 for 6-8 animals. No payouts have been made yet, but farmers who lost more than 15 per cent of their cattle may receive around US$180 per animal.

“So far, the predicted mortality [rate is] high – but we have to wait for the final tally at the end of October in order to determine whether or not there will be a payout,” said Brenda Wandera, project development manager at the International Livestock Research Institute (ILRI), Kenya, which implemented the scheme.

Read more…. (all Africa.com, August 2011)

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