The insurance initiative between Agritask and Royal Exchange is expected to support one million smallholder farmers by 2025
Image: Agritask partners with Nigerian insurer to provide ag-insurance. (Credit: Pixabay/Bruno /Germany.)
Agritask, an Israeli ag-management services provider, has partnered with Royal Exchange, a Nigerian insurance company, to launch a joint initiative to digitise crop and livestock insurance.
The insurance with key performance indicators (KPIs) aims to underwrite one million smallholder farmers in Nigeria by 2025. The insurance initiative has several stakeholders connected to the agricultural sector and beyond such as banks, co-operatives, ag-consultants, input distributors and ag-buyers, etc.
With lower levels of penetration of agricultural insurance in developing countries, uninsured smallholder farmers could be severely impacted by the variable forces of nature and their little financial means may not be enough to manage such risks.
Sustainable risk mitigation mechanisms and advanced technologies can help in reducing such risks for farmers.
Agritask CEO Ofir Ardon said: “Farming in most of the world is comprised of small-scale farmers who face the very same risks and challenges large commercial operations do: Bad weather, low yields, and supply chain challenges.
“However, they do not have the resilience that larger commercial operations have; that’s why there is a huge need for greater risk management abilities in this segment. Because we work with the entire ecosystem, we can provide economies of scale for growers, both at the individual farmer level, as well as for all other players in the ecosystem.”
A foundation for agri-insurance will involve every stakeholder in the ecosystem
For accomplishing this goal, Royal Exchange and Agritask started the project to create a solid foundation for digital crop-insurance framework in the country using Agritask’s well-structured and accurate data infrastructure facility.
The infrastructure is believed to be capable of combining diverse sources of data such as mapping of farmers, their field locations, crop types, weather, soil and topography, among others, onto a single platform.
Furthermore, the foundations will allow for accurate risk modelling and the design and pricing of suitable insurance policies.
Agritask claims that after seeing the initial results, the several stakeholders have expressed in the project and are interested in participating in it.
The single platform can also be used by the stakeholders and they can have customised tools tailored for their positioning in the ecosystem. This can, in turn, create new business opportunities while empowering farmers to opt for better and high-quality products.
Royal Exchange General Insurance Company Agribusiness & Business development head Chukwuma Kalu said: “Working with Agritask, we have a great opportunity to develop a more sustainable model.
“We believe this kind of sustainability can, and should, become a reality across Africa. With Agritask’s technology, we can level the playing field and get them to operate with the same resilience as larger commercial entities.”