NAICOM Floats in special Agric Insurance April
The National Insurance Commission (NAICOM), in an effort to complement the Federal Government initiative to boost food production will by April this year commence a special Agric insurance policy known as Index-Based Agricultural Insurance (IBAI) Programe.
ABAI programme has had its pilot phase in 10 states of the federation namely, Adamawa and Benue.
Other include Kaduna, Bauchi, Kano, Katsina, Kebbi, Nasarawa, Taraba and Zamfara.
NAICOM, Director Inspectorate, Barinake Thompson who disclosed this said IBAI scheme will support as well assist farmers in the country mitigate risks.
According to him, this scheme, which is new and better than conventional insurance policies will assist farmers in getting loans affordably from banks as well as get access to facilities.
Before last year, he said what Nigerian insurance firms were offering are pure conventional insurance ” Upto to early last year insurance companies go on to insure farmers, providing pure indemnity insurance covering mostly assets, machineries, tools, it didn’t even really cover yields from the farms. It covers for instance if you are transporting beans from the north to the south, and if there is accident on the way and it got damage, it will be indemnified. That what conventional insurance covers. IBAI is relatively new financial instrument used in transferring agaric risks from individual or those of farmers from to risks carriers. These risks are also reinsured both locally and abroad”, he said.
Thompson, further stated that NAICOM was collaborating with the Nigeria Incentive-based Risk Sharing System for Agricultural Lending (NIRSAL) on the initiative, stressing that NIRSAL is looking to expand insurance products for agricultural lending from the current coverage of 0.5 million to 3.8 million agricultural primary producers.
“The 2017 planting (wet) season has gone with five insurance companies participating in the consortium mainly under the NIRSAL facility, we anticipate that more companies will join in the 2018 planting season as a result of greater awareness and the upcoming capacity building programme,” he said.