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Sh214 million livestock insurance payout for drought-hit pastoralistsTuesday February 21 2017
The Kenya Livestock Insurance Programme (KLIP) will pay pastoralists in six counties affected by drought Sh214 million to cover their herd losses.
Announcing the payout plan Monday, Agriculture Cabinet Secretary Willy Bett said 12,000 pastoral households, mainly from arid and semi-arid areas, will benefit.
The insurance programme, which was initiated by the government in 2015 in partnership with selected insurance firms, is aimed at averting losses that might occur as a result of low pasture in the grazing fields.
“We will today embark on payment of Sh214 million to farmers whose livestock are faced with imminent death as a result of the ongoing drought,” said Mr Bett.
The programme is targeted at vulnerable pastoralists who receive drought insurance protection for five tropical livestock units (TLU), which is an equivalent to five cattle, or 50 goats, with an insured value of Sh14,000 per TLU per year, or Sh70,000 for five TLUs per household.
The government supports these pastoralists through premium funding, having paid the underwriters Sh160 million when the project was launched in 2015/2016 short rain seasons.
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The scheme uses satellites to monitor vegetation available to livestock and triggers assistance for feed, veterinary medicines and even water trucks when animal deaths are imminent.
These payments will be pegged to measurements of forage conditions relayed by satellite for each area, and will range from Sh1,450 per pastoral household in areas that have suffered modest losses to Sh29,400 in areas where drought is severe.
The minister said average payment is estimated at around Sh17,800 per pastoral household, directly reaching about 100,000 people.
“This is the biggest livestock insurance payout ever made under Kenya’s agricultural risk management programme and the most important as well, because without their livestock, pastoralist communities would be devastated,” said the CS.
“This insurance programme is not just an effective component of our national drought relief effort. It’s also a way to ensure that pastoralists can continue to thrive and contribute to our collective future as a nation,” he added.
The programme is a public-private partnership comprising seven insurers that include UAP, APA, CIC, Jubilee, Heritage, Amaco and Kenya Orient with the technical assistance from the International Livestock Research Institute (ILRI).
Short rains season
The KLIP began with Turkana and Wajir counties in the short rains season of 2015, and has now been expanded to also cover pastoralists in Mandera, Marsabit, Isiolo and Tana River counties.
APA Insurance, on behalf of the insurance consortium, will disburse most payments directly to pastoralists’ bank accounts or via mobile money transfer.
“It’s important to make payments quickly and efficiently and before conditions deteriorate further, because we want these livestock-dependent communities to see index insurance as something they can trust to sustain their way of life,” said Ashok Shah, Group CEO of APA Insurance.
Takaful Insurance of Africa, which launched the provision of a similar product in 2013, will this year be making payouts to over 2,000 households across six counties to the tune of close Sh10.5 million.