The Federal Government is planning to increase insurance coverage for the agricultural sector from the current 500,000 farmers to 3.8 million farmers.
The Managing Director, Nigeria Incentive-Based Risk Sharing System for Agricultural Lending, Mr. Aliyu Abdulhameed, said at a forum in Abuja on Monday that the move would help increase the level of output for the sector.
To achieve this, he said NIRSAL had commenced discussions with Royal Exchange Assurance and the Nigerian Meteorological Agency, among others, for the development of a technology-driven hybrid index insurance product.
According to Abdulhameed, NIRSAL is also exploring innovative insurance products for livestock to help stem the tide of herdsmen and farmers’ clashes.
He stated, “As indispensable as insurance is, it is the provider of mitigation of last resort. NIRSAL guarantees that smallholder farmers are supported in the areas of training and mentoring to ensure adherence to good agronomical practices. The support ranges from input, quality control to harvesting.
“We have made significant investments in technology solutions and innovations to counter the risks occurring in agricultural projects that we support. For instance, we have piloted the use of Geographic Information Systems to carry out field verification so that only viable lands are utilised for agriculture.”
The Commissioner for Insurance, Mohammed Kari, stated that the collaboration between NAICOM and NIRSAL had so far been very successful, adding that product approval had been granted to five companies to participate in the index-based agricultural insurance in Nigeria.
This number, he said, was expected to grow to 20 in the coming years.
“Using weather insurance to manage the risk of catastrophic weather events will stimulate economic development by improving stability and opportunities for growth in the agricultural and financial sectors,” Kari noted.