NIC signs MoU with Policy LINK to develop guidelines for Agriculture Insurance Fund takeoff
National Insurance Commission (NIC) has signed a Memorandum of Understanding (MoU) with Policy LINK to develop operational guidelines for the implementation of the Agriculture Insurance Fund.
The guidelines would put in place an effective governance systems to manage the Fund and provide protective cover for farmers against unpredictable weather patterns, pests and diseases, which could destroy the livelihood of farmers and food security.
Under the MoU, it is expected that Policy LINK would provide necessary technical support for the designing of the model taking into consideration the crops, segment of famers to be insured, regional focus and even subsidies.
The Agriculture Insurance Fund is a Statutory Fund that is established by the Insurance Act, 2021 (Act 1061) to help make agricultural insurance premiums more affordable, develop the logistics for the insurance delivery, train and build the capacity of the human resources and promote the deployment of technology.
Agriculture is a high-risk area in terms of insurance premiums, which are high and data have indicated that even banks do not give out credit facilities often to farmers due to the sector’s high risk nature.
It has been said that agriculture insurance would ensure financial inclusion, particularly for smallholder farmers in a sector that provides livelihoods for nearly 40 per cent of our population and contributes about one-fifth to the country’s economic value (Gross Domestic Products).
Mr Michael Kofi Andoh, Acting Commissioner of Insurance, National Insurance Commission, in a speech, said the knowledge and experience from Policy LINK would be invaluable and yield significant benefits for the agricultural sector.
He said the NIC together with Policy Link had begun designing the operational guidelines in line with government agricultural policy to identify the crops, number of farmers, geographical areas to be supported.
“The numbers may also depend on how much money we’re able to raise into the fund. So we are expecting that by September 2024, we would have finished the design and lunched the agricultural insurance fund,” Mr Andoh said.
Mr Yunus Abdulai, Policy LINK Country Lead, said agricultural insurance had become a key solution and would empower farmers to effectively manage climate-related risks, safeguarding food production and security.
“Current premiums on agriculture insurance are above the reach of many small holder farmers who are the backbone of Ghana’s agriculture activities. We will ensure a more secure future for our farmers and nation,” he said.
Policy LINK is a global Feed the Future programme that advances leadership and collaboration for better policy systems and with funding support from the USAID Mission in Ghana.
It supports the Government and policy actors, such as the Ministry of Food and Agriculture, the NIC, the private sector, farmer-based organizations and groups, civil society and the media,
Source: GNA