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Kilimo Salama, Experiences from KenyaFARM - Pluriagri conference - 18 dec 2012Rose Goslinga, Syngenta Foundation
Comment ça va?
Ca va bien !
Habari ? Mvua ameHabari ? Mvua amefika
Mvua badokufika
The mandate of Kilimo Salama
“Develop and implement agricultural insurance products
for smallholder farmers”
3
Traditional Insurance
Large scale farm:US$ 1000 Premium
- US$ 50 Visit Costs + US$950, insure
Small scale farm: US$ 10 Premium
- US$ 50 Visit Costs - US$ 40, can’t insure
We don’t visit the farm
Weather station, district yield data or satellite data
+ agronomic formula’s to agronomic formula’s to model required rainfall
Product Development
Areas in which we’ve learnt a lot….
Distribution & Customer
ServiceData
Rainfall requirements for a good yield
Area Yield Products Use District Data
807,8
686,63
600
800
1 000
Karongi Beans and 5 year average
Karongi
403,9
-200
0
200
400
2007 B 2008 B 2009 B 2010 B 2011 B
MT
/Ha Karongi 5 year average
Karongi Percentage Difference
Payout threshold
Payout Max
Western Kenya 2012
6,700 farmers received seed and fertilizer in April 2012
25 m
m 24 days with no rain….
54% loss of sum insured300,000 USD loss
=
April 2012
Western Kenya August 2012
Early Compensation is now a standard option
Combinations of Products
807,8
686,63
403,9400
600
800
1 000Area yield Weather index
+
-200
0
200
2007 B 2008 B 2009 B 2010 B 2011 B
Best of both worlds:- Cover for disease and flood risk through area yield index- Fast outcome of weather index products- Micro climates covered through weather index
+
We tried a variety of distribution channels
Distribution is key: 4 years of evidence
8,0
00
Nr
of
Farm
ers
5,0
00
19
,00
0
7,0
00
65
,00
0
Total Nr of Farmers
- Individuals: +7000
- Groups: 65,000
Premium:
- Individuals: 2mln Ksh
- Groups: 40mln Ksh
Premium rates:
- Individuals: 5%
(sponsored)
20102009
18
5
2,0
00
2011
5,0
00
2012
Individual sales grows, but groups sales was off the charts.
(sponsored)
- Groups: 5.6%
Average farm size:
- Individuals: 1-2 ac
- Groups: 0.5-1 ac
Gender:
- Individuals: 65% M
- Groups: 60% F
Challenges with aggregators….
• Delay in releasing loan results in yield losses
• Farmers default when • Farmers default when they know that there is insurance
• Banks focus: we want our credit repaid
Successful aggregators….
Are interested in the harvestBuy the harvest
Improve farmers incomes
Input + Agri Training on loan
Input + Agri Training on loan
Weather index Insurance
Weather index Insurance
Distributed to groups of farmers
Distributed to groups of farmers
Servicing your customer….
Improved Retention
Increased Sum Insured
Less Basis Risk
Data…. Historicals are available
Implementation structure
SORAS/ UAP
Primary insurer Kilimo Salama/SFSA
• Pilot development,
• Data collection,
• Pricing
• Training local partners
• Weather station
Swiss Re/ Africa Re
Product development,
reinsurer
Ministry of Agriculture
• Yield data collection, reporting and
certification
1818
• Weather station
management
certification
• Weather station regulation
Client Organisation
• Insured on behalf of farmers
• Pays premium
• Informs farmers
• Assess losses
• Disburses compensation
Farmers accessing services including insurance
A great team
