Drought insurance to minimise losses for herders in Kenya

gtclipobkvizk6exg58b47589a10f0 Drought insurance to minimise losses for herders in Kenya


Livestock farmers in seven counties that have been hit the hardest by the ongoing drought are set to cash in on insurance covers they took a year ago.

Takaful Insurance will today issue Sh10 million in compensation to farmers as foliage all but disappeared in some areas.

According to International Livestock Research Institute (ILRI) satellites, foliage in parts of the country’s arid and semi-arid lands (ASALs) has hit 0 per cent, while in some areas it is around 20 per cent – conditions that qualify for compensation under the weather-based insurance product.

“Some of the areas have hit 0 per cent and so will get the highest payout, which is 42 per cent of the sum insured,” said Anne Gatuma, the project administrator at Takaful Insurance of Africa.


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The Government also announced payments of more than Sh214 million for 12,000 pastoral households in six counties.

The compensation ranges from Sh1,450 per pastoral household in areas that have suffered modest losses to Sh29,400 in areas where the drought is particularly severe. The average payment is around Sh17,800 per pastoral household, directly reaching about 100,000 people, according to ILRI.

All weather divisions in Tana River, Garissa and Moyale are out of foliage, while in Marsabit, foliage is between 7 per cent and 13 per cent. Some parts of Isiolo, Mandera and Wajir have also triggered the compensation point.

Since the insurance cover was set up in 2013, Takaful has registered more than 7,000 farmers and 107,800 livestock across the seven counties. Tana River is the newest entrant; the product was launched in the county in August last year.

Sustain livestock

The cover uses ILRI satellite data to establish if the amount of foliage available can sustain livestock in an area before offering compensation at 58 per cent during the long rain-long dry season and 42 per cent for the short rain-short dry season.

Farmers pay about Sh1,800 to Sh2,000 a year to cover a camel for a sum insurance of Sh19,600. The sum insurance for a cow is Sh14,000, and Sh1,400 for a goat at varying premiums.


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Takaful has tailor-made the product for the ASAL region, which is also served by a Government-backed plan where the Treasury foots 50 per cent of the premiums that are underwritten by an insurer consortium of APA, Amaco, CIC, Heritage, Jubilee, Kenya Orient and UAP.

The Kenya Livestock Insurance Programme (KLIP) was introduced and piloted by the Government, ILRI, Financial Sector Deepening and the World Bank in partnership with the local firms.

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