National Insurance Commission partners with Policy LINK to develop Agriculture Insurance Fund guidelines

3 mins read
National Insurance Commission partners with Policy LINK to develop Agriculture Insurance Fund guidelines

The National Insurance Commission (NIC) has formally entered into a (MoU) with Policy LINK to collaborate on the development of operational guidelines for the effective implementation of the Agriculture Insurance Fund.

The key objective of these guidelines is to establish robust governance systems for managing the fund, which will provide critical insurance cover to safeguard farmers against unpredictable weather patterns, pests, and diseases that can jeopardise their livelihoods and .

The Agriculture Insurance Fund is a Statutory Fund, established under the Insurance Act, 2021 (Act 1061), with the primary aim of making agricultural insurance premiums more accessible, building the infrastructure for insurance delivery, enhancing the capabilities of human resources, and promoting the integration of technology.

Agriculture represents a high-risk area in terms of insurance premiums, characterised by elevated costs. As per available data, even are often hesitant to offer credit facilities to farmers due to the sector's inherently high-risk nature.

The introduction of agriculture insurance is expected to facilitate financial inclusion, especially for smallholder farmers. This group comprises nearly 40% of Ghana's population and contributes roughly one-fifth to the country's (GDP).

Mr. Michael Kofi Andoh, Acting Commissioner of Insurance at the National Insurance Commission, highlighted the significance of Policy LINK's experience and knowledge in the initiative.

He stressed that their collaboration aimed to design operational guidelines aligned with government agricultural policies, focusing on crop identification, farmer quantity, and designated geographical areas for support.

“The final number of beneficiaries may also hinge on the extent to which we can raise capital for the fund. Therefore, we anticipate that by September 2024, we will have completed the design process and launched the agricultural insurance fund,” remarked Mr. Andoh.

Mr. Yunus Abdulai, Policy LINK Country Lead, underscored the critical role of agricultural insurance in empowering farmers to manage climate-related risks effectively, thus safeguarding food production and security.

“Current premiums for agricultural insurance often exceed the financial capacity of many smallholder farmers, who constitute the backbone of Ghana's agricultural activities. We are dedicated to ensuring a more secure future for our farmers and our nation,” he affirmed.

Policy LINK, a global Feed the Future program, is dedicated to advancing leadership and collaboration for enhanced policy systems.

The initiative is supported by funding from the Mission in Ghana and collaborates closely with the Ghanaian Government, the , the National Insurance Commission, private sector entities, farmer-based organisations, civil society groups, and the media.

The partnership aims to drive positive change and progress in the field of agricultural insurance for the benefit of Ghana's community and the nation as a whole.

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