By Rasheeda Hamidu
Farmers are increasingly adopting agricultural insurance to protect investments against floods, drought, diseases and other production risks, Guinea Insurance Plc Managing Director, Ademola Abidogun, has said.
Abidogun made the disclosure on Tuesday in Lagos during an interview with the News Agency of Nigeria (NAN).
He said Guinea Insurance had insured about 50 farmer groups, including agritech firms, within six months, as the company expands agricultural insurance coverage across different segments of the value chain.
According to Abidogun, the company’s Agricultural Insurance Desk became fully operational in 2023 and currently serves crop, poultry, livestock and fishery farmers, as well as owners of farm properties.
Abidogun said smallholder farmers could benefit significantly from agricultural insurance because they are more exposed to production risks and often have limited access to finance for recovering from losses.
“Both sets of farmers benefit from our products; however, smallholder farmers benefit more because they are more exposed to risks and their limited access to finance,” Abidogun said.
He said the insurer had increased awareness campaigns through partnerships with agritech firms, particularly to improve insurance adoption among farmers in rural communities.
Abidogun cited a recent farmers’ engagement in Iseyin, Oyo State, where Guinea Insurance educated farmers on protecting their investments against unforeseen losses, after which several participants took up insurance cover.
The managing director said the company’s agricultural insurance products cover climate-related risks including floods, drought, windstorms and heat stress, alongside fire and other production-related losses.
He said its Crop Insurance Policy covers losses linked to fire, floods, pests, diseases, drought, windstorms and aircraft damage, while livestock and fishery policies cover specified losses including disease, flood, accidents and windstorms.
Abidogun said the company also operates an Area Yield Index Insurance Policy for crop farmers whose yields fall below agreed expectations because of adverse events such as drought, floods, heatwaves and windstorms.
He explained that compensation under the policy is determined using factors including cultivated hectares, historical production records, production costs, farm-gate prices, expected harvest and farmers’ experience.
The managing director rejected the perception that agricultural insurance is limited to commercial farmers, saying both smallholder and large-scale farmers had benefited from claims settlements when genuine losses occurred.
“Agricultural insurance helps to de-risk farmers’ investments and provides compensation when unforeseen losses occur,” Abidogun said.
He said premium rates vary according to the type of agricultural enterprise, location, cultivated hectares, number of livestock and scale of production, while genuine claims are processed after field assessments.
“For agricultural insurance, every reported loss is assessed on the farm, and genuine claims are paid within one week after the execution of the discharge voucher,” he said.
NatureNews notes that insurance can serve as a financial risk-management mechanism for farmers facing increasingly variable weather conditions, particularly where floods, drought and heat threaten agricultural production.
Abidogun urged farmers to consider insurance from the planning stage of their operations, saying early protection could help them recover from unforeseen losses and sustain their investments.
