The government of Tanzania in collaboration with the Association of Tanzania Insurers (ATI) has launched Agriculture Insurance Consortium (KONSOTIA YA BIMA YA KILIMO) to provide comprehensive insurance coverage for agricultural activities for its farmers.
According to Hussein Bashe, the country’s Minister of Agriculture, the consortium is expected to offer insurance solutions for the tobacco crop, with plans to expand the coverage to other crops, fisheries, livestock and forestry.
“The government is keen and committed to allocate funds through the Ministry of Agriculture to incentivize the adoption of agricultural insurance, reinforcing the importance of protecting farmers and mitigating risks in the sector,” said Bashe who officiated the launch.
He also touched on the crucial role of innovative insurance products in safeguarding millions of Tanzanians engaged in agricultural activities, either directly or indirectly, against diverse challenges such as floods, drought, and pests and diseases.
Dr Baghayo Saqware, Commissioner General of the Tanzania Insurance Regulatory Authority (TIRA), said the consortium will play a valuable role of advising the government on establishing the National Agricultural Insurance Scheme.
Tanzania’s agricultural insurance sales reached TZS 1.3 billion in 2021, which corresponds to 0.17% of the country’s total insurance sales in the country in that year.
The low penetration insurance in agriculture is attributed to the farmers’ inability to afford insurance premiums.
This is the second insurance consortium to be established in Tanzania, after the oil and gas insurance consortium established by 22 insurance companies.
Crop insurance coverage initiative
In April this year the country launched a crop insurance coverage initiative to help farmers to mitigate the impact of climate change and further boost the uptake of the services among growers.
This was a joint venture among fertiliser manufacturer Yara Tanzania, Jubilee Insurance and Equity Bank Tanzania to offer crop insurance coverage and help farmers access the service which is currently virtually uninsured in Tanzania.
Through AfricaConnect digital platform, which is a one-stop solution offering a wide range of services to farmers, up to 83,000 farmers growers are now benefiting insurance cover.