Farm Risks Also Need Insurance

‘No farmer, no food, no future’ is the slogan of the Zambia National Farmers Union (ZNFU), a clear expression of the importance of a farmer to the wellbeing of all.

Without food there is literally no economic activity no wonder the Bible says ‘man shall not live by bread alone… ‘

“The agricultural sector continues to be the backbone of the Zambian economy as it contributes to the growth of the economy and also to exports.

Primary agriculture contribute about 35 per cent to the country’s total non-traditional exports (all the country’s exports other than copper and cobalt) and about 10 per cent of the total export earnings for the country” reads the message on the Zambian Development Agency website.

Cultivating about 1.5 million hectares annually out of the 42 million hectares available in Zambia this sector calls for continued and concerted efforts both from government and the private sector to realise its full potential.

The just-ended 88th Zambia Agricultural and Commercial show was held under the theme ‘breaking new grounds’.

President Michael Sata in a speech read for him by Vice -President Dr Guy Scott said government expects all distributors of agriculture products to complement government efforts in promoting small and medium enterprises by fostering business linkages with local suppliers.

Earlier in April this year over 8,000 people attended the Agritech Expo in Chisamba at an event exclusively orgainised for famers.

Further government has increased beneficiaries under the Farmers Input Support Programme as disclosed by Agriculture Minister Wylbur Simuusa when he flagged off the distribution of farming inputs in May this year.

With all these efforts directed towards supporting agriculture, a farmer still faces risks that may derail his plans. He may get funds from the bank and invest everything in his field but imagine there being a drought in that season he stands to lose out.

Therefore, these interlinked activities cannot be complete without insurance.

Farming, like any other business activities, faces a number of risks which may discourage a lot of potential farmers. One can confidently face these risks with protection from insurance.

Being a small-scale farmer, I had an experience where I planted about one hectare of tomatoes which later was affected by a two-week drought. This resulted in a total loss for me.

It is, therefore, important for farmers and their financiers to consider risk management and more precisely arrange appropriate insurance for their crops and livestock.

Some of the risks that farmers face in respect of their crops include drought, fire, storm, hail, flood, tempest and malicious damage among others.

On the livestock side, risks that can be insured include mortality, uncontrollable pest and disease or epidemics, snake bites, theft, natural hazards such as fire, lightening, flood, hail etcetera.

The theft risk reminds me of an unfortunate event a few weeks ago where three pigs were stolen for the first time on my little farm. This resulted in an immediate loss of about K2, 000 excluding future profits through reproduction.

Other farm risks relate to the assets of the farmers such as their motor vehicles, planes, agriculture implements, buildings and so on.

Further a farmer will also need insurance for his workers such as health insurance, funeral insurance, employers’ liability insurance, group personal accident and public liability policy for damage or injury to members of the public or their property.

There are many policies offered by different insurance companies in Zambia such as Crop Insurance, Livestock Insurance or packed policies which are usually tailor-made to suit a specific farmer.

For commercial famers buying insurance is usually part of their budgeted expenses but to a small and medium scale-farmer this is usually least considered.

Take for example a small-scale farmer who struggles even to buy seed or other farming inputs.

How then can small and medium scale farmers be assisted? This is where associations such as the ZNFU and cooperatives play a pivotal role.

With the aggregated numbers in the unions, insurance can be arranged for the members and with big numbers insurance is even made more affordable. This is an area of microinsurance which will be duly discussed separately.

As I conclude today’s topic I urge farmers to seriously consider protecting their crops, livestock and other assets by arranging appropriate insurance policies.

Therefore while farmers say ‘no farmer, no food’ as an insurer I reiterate ‘no insurance, no farmer, no food, no future… !’

Comments: or or on face book search for Insurance Talk-Zambia page or calltext 0977 857 055

[The Author is a Chartered Insurer with ten years industry experience]

Source : The Times of Zambia

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