AIICO Insurance Plc is calling on all players in Nigeria’s agriculture sector to come together to improve sustainability and profitability, highlighting the essential role that insurance plays in managing risks and supporting growth. Leonard Okereafor, AIICO’s Agric & Emerging Risk Manager, spoke on this during a session on Agricultural Insurance at the annual training for the Nigerian Association of Insurance and Pension Editors (NAIPE) in Lagos.
Key Benefits of Agricultural Insurance
Okereafor emphasized that agricultural insurance provides critical benefits for farmers, such as ensuring income stability, facilitating access to loans, building partnerships, and managing risks more effectively. Insurance helps give farmers peace of mind, knowing they are financially protected against unexpected losses, and provides a foundation for expanding their operations.
Agriculture vs. Agribusiness
In his presentation, Okereafor explained the difference between agriculture and agribusiness. While agriculture focuses on food production through crop cultivation and animal rearing, agribusiness involves the entire value chain—from supplying inputs and farming operations to processing, distribution, and marketing. Agribusiness aims to make farming profitable and competitive, with the potential to drive economic growth.
Challenges in Agribusiness and the Role of Insurance
Okereafor highlighted challenges in Nigeria’s agribusiness sector, including limited access to advanced technology, weak market connections, and inadequate financial options. He stressed that addressing these obstacles is crucial for unlocking the full potential of Nigeria’s agriculture industry and creating a thriving agribusiness ecosystem.
Insurance Products for Nigerian Farmers
AIICO offers various agricultural insurance products designed to meet the specific needs of farmers and agribusiness investors:
- Poultry Insurance: Covers birds like broilers, layers, and hatchery stock against loss due to disease, fire, lightning, flooding, and accidents.
- Fishery Insurance: Protects fish stocks and pond structures against death or damage from environmental hazards.
- Livestock Insurance: Provides coverage for cattle, sheep, and goats, protecting them against accidents, diseases, and natural events like fire and flooding.
- Plantation Insurance: Covers crops, such as cocoa and oil palm, against damage from environmental risks.
- Farm Property Insurance: Protects farm assets, including equipment and storage facilities, from various risks.
- Multi-Perils Crop Insurance (MPCI): Insures crops against loss or damage due to fire, pests, diseases, and other threats, covering production costs for affected crops.
A Path to Resilience for Farmers
Okereafor emphasized that agricultural insurance is not merely an added expense but a critical investment in securing the future of farming businesses. He urged farmers and agribusiness owners to view insurance as a tool for resilience and long-term profitability, especially in light of unpredictable weather patterns and economic fluctuations.
A Vision for Growth and Food Security
As climate change and economic challenges continue to impact agriculture, AIICO is committed to supporting Nigerian farmers with insurance solutions that cater to their unique needs. Okereafor encouraged stakeholders to collaborate in strengthening Nigeria’s agricultural insurance framework to provide farmers with the necessary financial tools to succeed. AIICO’s initiatives align with the growing recognition of agriculture’s vital role in economic development, aiming to boost productivity, enhance food security, and promote financial literacy across the sector.