Goromonzi farmers receive insurance cash payout
About 1, 800 Goromonzi smallholder farmers who participated in the agricultural index insurance pilot project received their insurance payout on Wednesday last week at the back of an El Nino-induced drought during the 2023/2024 farming season.
Government ministers present at the payout ceremony called for scaling up of the project to cushion smallholder farmers throughout the country against climate-related risks.
As part of the pilot project, the smallholder farmers paid a premium of US$15 each and received a payout of US$65 per farmer under a Farmer’s Basket Insurance Product developed under a bundled weather index and area yield index insurance.
Key stakeholders who participated in the development of the product included, the Ministry of Finance, Economic Development and Investment Promotion, the Ministry of Lands, Agriculture, Fisheries, Water and Rural Development, the Insurance and Pensions Commission (IPEC), Insurance Council of Zimbabwe (ICZ), Access to Insurance Initiative(a2ii), International Finance Corporation (IFC), Insurance Brokers Association of Zimbabwe (IBAZ), Women Farmers’ Land and Agricultural Trust (WFLA), Zimbabwe Farmers’ Union (ZFU), and World Food Programme (WFP).
Finance, Economic Development, and Investment Promotion Minister, Professor Mthuli Ncube officiated at the payout ceremony in Goromonzi. The Minister of Lands, Agriculture, Fisheries, Water, and Rural Development, Dr Anxious Masuka, and the Minister of State for Provincial Affairs and Devolution, Honourable Aplonia Munzverengwi also participated at the event.
In his remarks, Prof Ncube praised the collaboration among key stakeholders in developing the Farmer’s Basket Insurance Product saying the innovative insurance product would help build smallholder farmers’ resilience.
“Today’s payout to Goromonzi farmers is more than just a financial transaction, it is a symbol of progress, resilience, and the tangible impact that innovative financial solutions can have on our agricultural communities,” said Prof Ncube.
“This momentous occasion marks the first fruits of a pilot study that I believe will have far-reaching benefits for farmers across Zimbabwe.”
He said Government is committed to see agricultural insurance for smallholder farmers scaled up across the country.
“The success of this pilot project demonstrates the potential for scaling up agricultural insurance and enhancing the economic stability of rural communities across the country. We recognise the importance of easing the financial burden on our smallholder farmers, and as such, the Government is ready to subsidise insurance premiums for smallholder farmers. This subsidy will help make agricultural insurance more accessible, ensuring that more farmers can benefit from these innovative risk mitigation products,” said Prof Ncube.
In his remarks, Dr Masuka said the adoption of agricultural index insurance is expected to enhance farmers’ productivity.
“The hard work begins now. Replicability is the basis for sustainability. It is absolutely critical, that we replicate this model so that it becomes sustainable and builds the resilience of these farmers as we move forward,” said Dr Masuka.
Hon. Munzverengwi said the 2023/2024 agricultural season presented ample evidence about the threat that climate change poses to farmers throughout the country.
“The introduction of agricultural index insurance is a game changer for us. It provides our farmers with much-needed financial protection against unpredictable weather patterns, allowing them to invest confidently in their crops, knowing that they have a safety net” she said.
There are already engagements among key stakeholders to replicate the Farmer’s Basket in the other provinces, which will go a long way in not only increasing insurance penetration but also mitigating climate-related risks that smallholder farmers face.
