Kenya launches biggest ever insurance payouts for livestock herders

Technology-enabled insurance program launched by the Kenyan government which uses satellites to trigger assistance for feed or water.

The Kenyan government has partnered with Kenyan insurers to make its biggest-ever financial support payment to pastoral households as part of an effort to address drought emergencies in the Horn of Africa.

The government is expected to make a payment of over $2 million to more than 12,000 pastoral households under the Kenya Livestock Insurance Program, or KLIP.

The scheme is a ground-breaking, technology-enabled insurance program that uses satellites to monitor vegetation available to livestock and “triggers assistance for feed, veterinary medicines and even water trucks when animal deaths are imminent.”

“This is the biggest livestock insurance payout ever made under Kenya’s agricultural risk management program,” said Willy Bett, cabinet secretary for Kenya’s Ministry of Agriculture, Livestock and Fisheries. “Without their livestock, pastoralist communities would be devastated,” he added.

In a press release, Bett explained that the insurance program was a component of Kenya’s national drought relief effort. “It’s also a way to ensure that pastoralists can continue to thrive and contribute to our collective future as a nation,” he said.

By the end of February, the payout will be made through the KLIP, with an average payment per pastoral household costing about $170.

“We are hopeful that we are writing a new chapter in the long and challenging history of one of the oldest forms of agriculture still practiced in the world today,” said Andrew Mude, a principal research scientist at the International Livestock Research Institute and recipient of the 2016 Norman Borlaug Award for the development of index-based livestock insurance.

Kenya’s Ministry of Agriculture developed KLIP, modeled after Index-Based Livestock Insurance, with technical assistance from ILRI, the World Bank Group, and Financial Sector Development Kenya. With backing from Swiss Re, an international reinsurer for agriculture, KLIP will be administered as a public-private partnership with APA Insurance and seven Kenyan insurers.