• Saturday, May 18, 2024
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Heifer International boosts smallholder farmers with N100m insurance payout

Nigeria’s agric potential hindered by low technology

In its resolve to help smallholder farmers mitigate adverse effects of climate change, pests and diseases, Heifer International has announced a payment of over N100 million as insurance compensation payout from Leadway Assurance to 3,110 smallholder rice farmers operating in Benue and Nasarawa states of Nigeria under its pay-at-harvest Area Yield Index Insurance (AYII) project.

AYII which is a component of Heifer’s Naija Unlock Signature Program for the country was launched in Nigeria in 2021 by Heifer International in partnership with OLAM, Leadway Assurance and PULA as a solution to mitigate climate change-induced losses among smallholder farmers and restore investors’ confidence in rice farming.

Speaking during the farmers insurance claim payout ceremony held in Makurdi, Benue State, Rufus Idris, Heifer’s country director, confirmed that a total of 4,358 hectares of farmland belonging to 4,354 smallholder rice farmers in Benue and Nasarawa states were insured during the 2021 wet farming season under the project, among which 3,110 smallholder rice farmers suffered losses due to soil moisture stress.

Idris explained that the project is carried out through a pay-at-harvest model that enables participating farmers to pay back the pre-financed premium at harvest when they sell the rice produced to Olam as the off-taker.

According to him, the recovered insurance premium is then re-used to pre-finance premiums for smallholder farmers during the next farming season, hence guaranteeing farmers resilience to climate-induced losses.

Read also: Heifer International unveils crop insurance to Nigerian farmers

“This cycle continues for 3 to 5 farming seasons until the rice farmers see the value of the innovative crop insurance, adopt the new practice, and begin to attract private sector interest for the financing of their crops and farmlands,” he said.

The affected 3,110 smallholder rice farmers who suffered poor harvests are scheduled to receive a total sum of one hundred and eleven million, three hundred and ninety-eight thousand, eight hundred and ninety-five Naira (N 111, 398, 895), starting today, as insurance compensation claim to enable them to recover their investments and refinance their insurance premium for another farming season.

Ayoola Fatona head of agric and micro insurance for Leadway Assurance Limited, an implementing partner for the insurance scheme, “today marks a major milestone in the Nigerian Agriculture Insurance space. Leadway wishes to reiterate our commitment to assisting smallholder farmers in guaranteeing the food security of the nation by leveraging on this type of partnership with Heifer International”.

“With climate change and adverse weather conditions playing a crucial role in negatively impacting farmer’s productivity and earnings, there’s never been a more critical time for AYII to create a soft-landing for farmers that need protection against nature’s uncertainty,” said Chukwuma Kalu, PULA’s commercial manager- West Africa Anglophone.

Smallholder farmers in Nigeria are constantly exposed to climate change-induced shocks from unreliable weather conditions, new pests and diseases that cripple their farming businesses and discourage agribusiness financiers and investors from investing in smallholder farms, he said.

Findings indicate that overall, climate change is projected to cost 6percent – 30percent of Nigeria’s GDP by 2050, translating to $100 billion – $460 billion in losses. “In September 2020, farmers in Northern Nigeria lost more than two million tons of rice, a quarter of the country’s projected harvest, due to flooding.