Nigeria are the latest country we’ve heard of which has a desire to establish a scheme to help its farmers protect their livelihoods from the vagaries of the weather and changing climate patterns. Only 1% of farmers in Nigeria have access to insurance cover, this despite the fact that 90% of Nigeria’s agriculture is said to be dependent on rainfall and rain-fed systems.
A recent forum on microinsurance held in the country has helped to raise the profile of the plight of Nigeria’s farmers and the lack of weather risk cover for their crops.
Weather extremes and the changing climate are said to be the biggest risks to farmers in Nigeria and so the scientific, farming and financial communities are determined to provide a weather risk management mechanism which meets the needs of farmers.
Index-based weather insurance products would be an obvious answer to the risk management need of farmers in Nigeria. However, some ground work will be required as the country is lacking in meteorological infrastructure and the regulatory frameworks are not supportive of new products. Also the domestic insurance industry is lacking in capacity so it may transpire that a global re/insurance company would be better suited to lead a pilot scheme.
The World Bank was said to be in attendance at the forum so it is possible that they might issue a grant to help Nigeria initiate a weather-index insurance scheme.
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