During the severe drought that hit Rwanda in 2015 and 2016, Jean Damascene Karani, a livestock farmer from Nyagatare District lost 30 cows.
The 79-year-old considered quitting farming after the prolonged drought devastated Eastern Province, leading to severe shortage of pasture and water.
According to figures from the Ministry of Agriculture, by 2017 farmers in the Eastern Province had lost a combined 2,400 cows due to drought, eroding the country’s gains in beef and dairy industries.
Farmer Karani and his cows in Nyagatare District, Eastern Province, Friday, July 19, 2019. The farmer testifies that he is secure as his cows are now insured against diseases and accidents. / Courtesy
But without any immediate income-generating activity to turn to, Karani decided to hang on to livestock farming as he weighed his options.
When the Government launched an agriculture insurance scheme early this year, Karani was one the farmers who signed up to the scheme. He took up an insurance policy of Rwf699, 300 for his 58 cows.
Now, the decision is proving to be a good bet.
Last month, Karani lost a cow due to an unknown illness, prompting him to turn to government for compensation. He was paid Rwf700,000 in compensation for his loss.
Karani is one of the five farmers who have so far been indemnified through the national agriculture insurance scheme, a joint initiative of the government and private insurance firms.
“Before the insurance cover, I used to run to my neighbours for support in case I recorded losses,” Karani said. “We’ve got insurance to compensate us based on the value of the cow. That is a great achievement, which demonstrates Rwanda’s visionary leadership.”
With this arrangement, Karani expects a boom in livestock farming as more and more people will be willing to join the sector because of the low risk.
Under the national insurance scheme, a farmer pays 60 per cent of the insurance premium, while the government covers the remaining 40 per cent.
Joseph Museruka, the Manager of National Agriculture Insurance Scheme (NAIS) at the Ministry of Agriculture, said that once a farmer’s claim is registered and a veterinary doctor issues a report, it takes between 7-15 days to compensate the farmer.
Insuring livestock is expected increase production, increase farmers’ access to finance and significantly contribute to poverty reduction.
“It builds confidence among sector players that the risks would be covered,” Museruka said.
Some 960 cows have so far been insured.
In the current financial year, agriculture and livestock insurance project has been allocated Rwf370 million with a target to insure maize plantations on 7,968 hectares and rice on 937.5 hectares, as well as more than 21,400 cows.
Three insurers, including Radiant, Prime Insurance and SONARWA, were chosen to offer insurance services to farmers in the first two-year initial phase. The ministry said that more players will be included in the scheme.
Livestock insurance covers dairy cattle, including both cross and exotic breeds in eight selected districts while the crop insurance covers maize and rice farmers in ten districts of the country.
The scheme will be scaled up countrywide.