Today, for the first time in Africa, an insurance policy that combines an Islamic-compliant financial instrument with innovative use of satellite imagery is compensating Muslim pastoralists for drought-induced losses suffered in Kenya’s northeastern Wajir County, where livestock are valued at Ksh46 billion (USD550 million).
Thirty women and 71 men in arid and semi-arid Wajir are the first beneficiaries of livestock insurance that conforms to the Islamic concept of takaful, in which risks are shared among a group of participants. Through a contract called tabbaru (donation), participants make contributions to a risk fund. In the case of a payout, which happened today, the fund makes payments commensurate with the contributions received.
The pilot program is paying approximately Ksh500,000 (USD5,800) for losses suffered to their herds…
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