Drought, flooding and pests cause crop loss – leading to malnutrition or famines. The sooner farmers can react to weather events or have harvest losses replaced, the better food security can be achieved.
“Kilimo Salama”, which means in Swahili “safe harvest” is part of the start-up “ACRE”. The company is committed to insuring Kenyan smallholders against extreme weather conditions such as drought or flooding. The special feature of this insurance scheme is that the insurance can be purchased together with the seeds for five percent of the purchase price. For payment and compensations, Kilima Salama uses M-Pesa, so that all transactions can be conveniently made by mobile phone.
Once the insurance is in effect, solar-powered weather stations observe the climate conditions in the area. If there is too little or too much rain, the smallholder will automatically receive a payment via M-Pesa, which compensates him for the costs of the seed. Kilimo Salama uses a number of innovations and saves on administration costs, eliminating the need for inspection visits, damage surveys and lengthy compensation settlements. This makes insurance affordable, even for small farmers who manage just a few fields. More than 187,000 farmers were insured by the end of 2013. Since 2015, the programme has been active in Kenya, Rwanda, Tanzania, Zimbabwe, Nigeria and Ethiopia.