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Nelson Gahadza
Senior Business Reporter
The success of the weather-indexed agriculture insurance pilot project in Goromonzi, Mashonaland East Province, demonstrates the potential for scaling up agricultural insurance and enhancing the economic stability of rural communities.
The insurance product dubbed the “Farmers’ Basket”, aims to protect smallholder farmers against early and late dry spells and multiple production risks, which can lead to a significant reduction in yields.
For the pilot project, while 4 014 smallholder farmers from 21 wards in Goromonzi district initially registered to participate in the pilot phase, only 1 800 farmers paid the requisite premiums of US$15 and were the ones covered and received a payout of US$65.
Finance, Economic Development and Investment Promotion Minister, Professor Mthuli Ncube, yesterday attended the payout ceremony in Goromonzi where he said Government recognises the importance of easing the financial burden on smallholder farmers and is ready to subsidise insurance premiums for them.
The subsidy will help make agricultural insurance more accessible, ensuring that more farmers can benefit from the innovative risk mitigation products.
“We participated in this pilot programme of providing insurance at the farmer household level; it went very well, and the farmers today received a payout of US$65 each out of the insurance premium that they paid,” said Minister Ncube.
“But going forward, we are going to spread this programme right across the country, making sure that insurance at the farmer level is also part of the inputs that we provide.
“Of course, we will do it on a subsidised kind of approach where the farmer contributes something and the Government also contributes.”
Prof Ncube added that when the farmer claims, it is almost similar to a kind of cash, receipt or cash transfer but is linked to production and the outcome of the weather pattern.
Lands, Agriculture, Fisheries, Water and Rural Development Minister, Dr Anxious Masuka, said the agriculture insurance index will propel agriculture to greater heights and drive rural development in line with Vision 2030.
“Agriculture should drive the economy and the farmers should become economic participants through the inclusive insurance concept. This should be replicated across the country,” he said.
Minister of State for Provincial Affairs and Devolution for Mashonaland East Province, Aplonia Munzverengwi, said the province is vulnerable to climate change and the insurance index has provided protection to farmers.
AFC Insurance managing director, Mr Cuthbert Masukume, on behalf of the ICZ, said: “Most of the claimants have already received their payouts through a mobile payment platform and those here present today shall be receiving their pay-outs in cash,” he said.
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