(Business in Cameroon) - On August 2, 2019, an agricultural index insurance project was launched in Cameroon. This insurance uses objective and transparent parameters that do not require costly field visits, rainfall level, for example, to verify losses.
In that regard, the International Finance Corporation (IFC), World Bank Group’s arm for private investments, signed about XAF270 million of grant agreement with Activa Assurance and AXA Cameroon, two Cameroonian insurance companies. This agreement is aimed at helping thousands of Cameroonian farmers and breeders acquire affordable insurance coverage.
“Index insurance has numerous advantages, income stabilization notably, for farmers who are now less dependent on climate conditions. It also improves their access to funding since climate insurance can secure seasonal loans or the inputs’ purchases,” said Minister of agriculture Gabriel Mbairobe, who presided over the official launching ceremony.
According to Fatou Assah in charge of the project for the IFC, “it is clear nowadays that index insurance influences the way we address resilience to climate change.” “This is particularly true for Cameroon where agriculture is still vulnerable to climate-related shocks,” she added.
In the framework of the 2-year pilot project, the involved insurance companies will provide special teams for capacity-enhancing activities, the development of additional agricultural insurance products for farmers and breeders via producers associations, cooperatives, agricultural inputs suppliers, commercial banks and microfinance institutions.
The IFC and its partners want to issue, by end 2020, more than 135,000 agricultural index insurance contracts. These contracts will help more than 700,000 agricultural households cover their farms, access farm inputs and compensate their losses in case of disasters.