Tracking pastures

Prolonged periods of drought lead to the loss of pasture, and consequently, the death of animals. Herders in northern Kenya whose livelihood is dependent on their animals risk losing their family income and the ability to finance their children's educations. The loss of just a few animals can ruin their lives. A just-launched insurance scheme for drought-related livestock mortality in northern Kenya could ease the burden for pastoralists.

Tracking vegetation

The Nairobi-based International Livestock Research Institute (ILRI) worked with Equity Bank and UAP Insurance LTD to establish the special insurance for herders that went on the market last week. The scheme works like this: a satellite takes weekly images of a particular region, which are then used to determine whether the vegetation there is sufficient to maintain livestock. Farmers are given a payout when the pasture is inadequate for their herds.

In the first year, the value of a herd (five cows or 20 goats/sheep) will be 15,000 Kenyan shillings (about $200). Should the pasture shrink by 50 percent in the first year, for example, the herder could receive up to $100 - that's the idea, anyway.

A herder will have to spend at least $6 a year to insure his herd. Matthias Rompel, head of the Social Protection Section at Germany's development aid agency GTZ, told Deutsche Welle that this scheme will improve the social protection of pastoralists - a basic human right.

From agricultural insurance to sustainable development?

As researchers look for more ways to ensure food security, agricultural insurance is becoming a growing issue in the development aid sector. Though Rompel believes the scheme will not become the biggest form of donor aid, it will play a role "in sustainable development of rural areas in the context of food security and nutrition," he said.

The scheme could have other benefits, too. "The insurance could potentially act as collateral for a lot of individuals to access loans," Dr. Andrew Mude, Researcher at ILRI, told Deutsche Welle.

The loans could help the pastoralists start small businesses, for example.

Still, whether it's insurance schemes or related loans, it's too early to assess the viability of the programs in developing countries. "We don't have many examples which can show that livestock insurance can be successful in general," Rompel said.

Livestock insurance in Mongolia and agricultural insurance against flooding in Indonesia have shown great potential, but their financial sustainability must yet be proved.

Blazing trails

The livestock insurance program in Kenya is the first of its kind in Africa, and "part of the difficulty was getting the population to understand the concept of insurance," Mude said.

Rompel agreed. One of the challenges is "promoting micro-insurance to the end-consumer - the small-scale livestock owner."

Nonetheless, governments, aid organizations, donors and researchers will likely keep a close eye on the livestock insurance programs - in the hope that they will catch on quickly.

Author: Chiponda Chimbelu
Editor: Anke Rasper/Louisa Schaefer