The Sunday Mail
Business Reporter
LAST week, a Marondera farmer lost his tobacco crop after a hailstorm swept across his farm.
The storm struck at a crucial time as Mr Tawanda Chihwai was preparing to start picking his “golden leaves” for curing. According to Mr Chihwai, the devastating hailstorm lasted for about 15 minutes and destroyed his entire crop.
“We were supposed to start picking the leaves next week, but we have lost everything,” said Mr Chihwai.
“It’s either we have to replant or wait for the next season.”
Given that his tobacco had almost reached the leaf picking stage, Mr Chihwai had invested a lot of money on inputs including seed, fertilisers, chemicals as well as labour.
Hundreds of thousands of other farmers may find themselves in the same predicament in light of growing risks of climate change, which has become a major threat to agriculture.
In the past few years, Zimbabwe experienced extreme weather conditions including cyclones and recurring droughts, which negatively affected agricultural output.
To avert such disasters and minimise losses, farmers need to start insuring their crops.
“Agriculture insurance broadly covers the damage of machinery and infrastructure, but natural disasters are becoming more prevalent due to climate change.
“As such, the insurance sector needs to come up with innovative products especially for small scale farmers,” Mr Peter Musara, a development economist with a local university said.
At the moment, the main consumers of agricultural insurance are commercial and contract farmers.
However, the uptake of insurance by small-scale farmers has remained largely subdued.
According to the Agriculture Marketing Authority, the possible reasons for low take-up among farmers include lack of awareness and knowledge on insurance benefits.
According to the Insurance and Pension Commission (IPEC), farming insurance accounted for 3,35 percent of the Gross Premium Written in the first quarter of 2021, compared to 2,13 percent recorded during the same period a year earlier.
Analysts say despite a slight increase, it remains a low percentage for an agro-based economy.
Smallholder farmers contribute nearly 70 percent of the total national farm output.
“There are no proper aggressive outreach programmes to encourage farmers to adopt insurance,” Zimbabwe Farmers Union executive director Paul Zakariya said.
“And those who might be aware of farming insurance, it is interpreted as throwing away money in the event that no extreme events happen. So it becomes important to roll out awareness programmes to educate farmers about the benefits.”
In Africa, Kenya-based Pula is one the start-ups using technology to help farmers insure their crops and livestock.
It was founded in 2015 by Dutch entrepreneur Rose Goslinga and Kenyan insurance actuary Thomas Njeru and offers agricultural insurance services to help smallholder farmers insure yield risks, improve their farming practices, and bolster their incomes over time.
It now operates in 16 countries and has now insured about 5,1 million farmers and claims paid to date amount to US$13,5 million.
“Farming is risky; once you have insurance, you create a foundation,” Ms Goslinga told an international publication last month.
“Otherwise, you are in quicksand.”
