Since last week, I’ve read the most disheartening stories about SME farmers losing ~25bn to African Swine Fever, poultries losing farms to flood, etc. I hear insurance penetration/awareness is low among farmers. I’ll do a thread on agric insurance options. Tag a farmer you know. 
The Agric Sector has remained one of the largest contributors to GDP for years. The sector alone contributed 26.09% to the real GDP in Q4 2019 and 21.96% in Q1 2020, with only services contributing higher; with contributions from livestock, forestry, crop production and fishing.
Despite the GDP contribution, the sector has experienced steady decline in y-o-y growth, according to recent data from @nigerianstat, and given that the largest number of players in this sector are MSMEs, it shows that MSME farmers have been suffering setbacks over the years.
Now amongst the reasons for these setbacks are inadequate funding, infrastructure, and insufficient risk mitigants. To make it simpler, according to the @FAO agric employs 2/3rds of Nigeria's population, and for such impact, only gets 1.3% of Nigeria's total budget. A disaster.
So with the limited funding, the decadent infrastructure, and the survivalist nature of the business (most farmers are in it for survival), it is important that we increase awareness & penetration about insurance, to help prevent unforeseen losses to already challenged farmers.
The myriad of risks associated with the Agric Sector can be categorized as
1. Natural risks (which may include hail, storm, flood, diseases, etc.)
2. Manmade /Artificial risks (fire, theft, vandalism, etc.)
3. Economic risks (price fluctuations, loss of income, currency, etc.
1. Natural risks (which may include hail, storm, flood, diseases, etc.)
2. Manmade /Artificial risks (fire, theft, vandalism, etc.)
3. Economic risks (price fluctuations, loss of income, currency, etc.
Depending on the type of farming you do, you can buy various types of agric insurance products. And many of the myths you've heard about insurance are false. First, agric insurance exists in Nigeria, insurance companies pay claims (at least most of them), & it is not expensive.
Now what are the types of insurance?
Poultry Farm Insurance: this product provides cover for birds (broilers, layers, parent stock, grandparents stock, etc.) against death as a result of fire, lightning, windstorm damage, flood, uncontrollable disease and accident.
Poultry Farm Insurance: this product provides cover for birds (broilers, layers, parent stock, grandparents stock, etc.) against death as a result of fire, lightning, windstorm damage, flood, uncontrollable disease and accident.
Livestock Insurance: this insures livestock (e.g. cattle, sheep, goats, rabbits, and pigs) against death caused by fire, lightning, windstorm, flood, accident, uncontrollable disease, etc. The sum insured is dependent on the declared, and/or projected market value of the animal.
Plantation Fire Insurance: protects cocoa, sugar cane, oil palm and other plantation farms against loss or damage as a result of fire, lightning, flood, windstorm, and aircraft perils.
Fish Farm Insurance: insures fish species against death and fishpond against collapse as a result of fire, lightning, windstorm damage, flood, uncontrollable disease and accident.
Multi-Perils Crop Insurance: insures your farm against loss of, or damage to, your crop caused by fire, lightning, explosion, aircraft damage, windstorm, flood and outbreak of uncontrollable pest and disease.
Area Yield Index – Based Insurance: provides cover against drought, excessive Rainfall, windstorm, frost, uncontrollable plant disease and pest, excessive heat wave, hail, and flood.
Weather Index Insurance: this product covers farms against inadequate or excessive rainfall leading to crop loss. For example, the insurance can be structured to protect the insured against too much or too little rainfall.
For all products, the sum insured (i.e. the value or amount you are repaid in case of a loss) is based on the value you declared, &/or projected market value of the farm products. Premium rate is dependent on the level of risk management, biosecurity, type & size of farm.
What you pay can vary from less <1% to >4% of the value of your farm when assessed with the parameters above. When you compare this to what you get to lose in cases of disasters, then you see it's totally worth it. Losses are real. Here is an example story
Here is another thread of losses by farmers struggling to survive. It is saddening & preventable. Please share with farmers you know. End
Photo credit in first tweet: @sholaanimashaun & @Nig_Farmer
Data source: @nigerianstat
Thread inspired by @borie_nla
Photo credit in first tweet: @sholaanimashaun & @Nig_Farmer
Data source: @nigerianstat
Thread inspired by @borie_nla
Oh, and I forgot to add that there is a full-fledged government-owned company - Nigerian Agricultural Insurance Corporation that is saddled with the responsibility of making available these products to the Nigerian agric space whilst some other insurance companies also offer them
And should you get bad service from any of the insurance companies or they refuse to pay your claims, you can send a mail to the National Insurance Commission (NAICOM) Complaints Bureau via this link naicom.gov.ng/index.php/supp… or to @fccpcnigeria.
