25 March 2014
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 Ksh 46 billion (USD 550 million).
The 30 women and 71 men in arid and semi-arid Wajir will be 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, the fund makes payments commensurate with the contributions received. The pilot program will pay approximately Ksh 500,000 (USD 5,800) for losses suffered to their herds of sheep, goat, cattle and camels during the long dry season that typically ends in March….read more