Insurance companies and brokers in Ghana have been sensitised on agricultural insurance to enhance their capacity to develop and roll out insurance products that support farmers in mitigating the effects of climate change on agricultural production.
The participants were also equipped with knowledge on how to support farmers through financial protection mechanisms and insurance policies that could improve farming practices, increase yields and contribute to national food security.
The two-day online engagement was attended by participants representing various insurance companies operating in the country.
The programme, organised under the TEMBO Africa Project, was hosted by the Ghana Insurance University College (GIC) and the Ghana Agricultural Insurance Pool (GAIP) on the topic: “Introduction to Agricultural Insurance in Ghana: An Overview of the Agricultural Insurance Value Chain.”
The TEMBO Africa Project is funded by the European Union in partnership with Delft University of Technology (TU Delft) in the Netherlands, the University for Development Studies (UDS), Tamale, the Trans-African Hydro-Meteorological Observatory (TAHMO), the Ghana Meteorological Agency (GMet), Farmerline Ghana and other institutions.
Mr Kwabena Akuamoah Agyekum, Executive Director of the Chartered Institute of Marketing, Ghana (CIMG), who facilitated the session, educated participants on agricultural insurance and encouraged insurance operators to explore opportunities in the sector to develop products tailored to the needs of Ghanaian farmers.
He took participants through the various types of agricultural insurance products, marketing agricultural insurance to smallholder farmers, and distribution channels and partnerships within the agricultural insurance value chain.
Mr Agyekum explained that agricultural insurance was a risk management tool that protected farmers, agribusinesses, livelihoods and production investments, while reducing financial losses, promoting food security and strengthening national food sovereignty.
He noted that smallholder farmers continued to face climate-related challenges, including drought, erratic rainfall patterns, excessive rainfall, flooding, pest infestations, crop diseases and market uncertainties.
“This year when we went to Yendi they had grown groundnut that had geminated but the yield is terrible. They uprooted and is like nothing there. Agriculture Insurance could have helped them out,” Mr Agyekum said.
Mr Agyekum said agriculture remained a major contributor to Ghana’s economy and livelihoods, accounting for about 21 per cent of Gross Domestic Product (GDP) and employing approximately 35 per cent of the national workforce.
He, however, observed that farmers faced significant risks arising from climate variability, limited irrigation infrastructure, disease outbreaks and market uncertainties, often resulting in reduced yields, income losses, loan defaults and food insecurity.
“So, agriculture insurance will help build the resilience and confidence within the agriculture sector. That is how come Ministry of Food and Agriculture (MoFA) is one of our key stakeholders,” he said.
Mr Agyekum advised farmers to complement efforts to expand their farms with measures to protect their investments through insurance.
He emphasised the need for intensified public education and sensitisation, particularly among smallholder farmers, to improve understanding of the benefits of agricultural insurance.
According to him, agricultural insurance enables farmers to protect their incomes, while financial institutions benefit from reduced credit risks, increased agricultural lending and improved portfolio quality.
“For Ghana to support food security, and its National Food Buffer Stock, Agric insurance could enable that. It would also enhance climate resilience, ensure insurance penetration, develop new market, and contribute to national development and growth.”
He identified key stakeholders within Ghana’s agricultural insurance ecosystem as farmers, insurance companies, GAIP, reinsurers, financial institutions, government agencies, regulators and development partners.
Touching on the evolution of agricultural insurance in Ghana, Mr Agyekum said the sector had transitioned from traditional informal risk-sharing arrangements among families and communities to modern insurance products, including crop insurance, livestock insurance, weather index insurance and yield index insurance.
He further encouraged insurance companies to explore products covering weather-related risks such as drought, flooding and excessive rainfall, as well as biological risks including pest attacks, diseases, crop failure, livestock losses and aquaculture risks.
On challenges confronting the sector, he cited low awareness of agricultural insurance, high transaction costs, limited weather and flood data, climate change impacts, affordability concerns and low insurance penetration.
He said emerging opportunities included satellite technology, remote sensing, mobile money platforms, digital onboarding systems, data analytics, public-private partnerships and increased climate financing.
“Agriculture insurance in Ghana serves as a critical tool for managing agriculture risk, protecting farmers livelihoods through access to finance and we believe it can strengthen national food security- the buffer stock should learn from this,” he said.
Mr Samuel Orison Yarney, Marketing Officer of GAIP, took participants through the Germination Index Insurance (GII), an innovative product designed to protect farmers against seed germination failure caused by prolonged drought or excessive rainfall.
He said the product had been piloted among maize, soybean and rice farmers in the Northern and Upper West regions to enhance climate resilience among smallholder farmers.
Mr Yarney said the project was being implemented by GAIP under the Ghana Insurers Association in collaboration with TU Delft, TAHMO, GMet and other partners.
He explained that extensive community sensitisation campaigns had been conducted and that jingles in five local languages were being designed to aid sensitisation among farmers on the importance of insuring their seeds against climate-related germination failure.
He said the pilot stage lasted last year.
The idea is to resource the farmer to buy seeds and replant, should their first seeds fail to germinate within its specified germination period, he said.
Mr Yarney said the GII would help protect farmers’ initial investments, reduce financial losses and minimise the impact of poor germination on crop production.
GNA