Uganda has been moving from fragmented pilots towards a more structured public-private agricultural insurance system, according to Mr Bran Atiku, National Project Officer, Insurance and Risk Finance Facility, UNDP Uganda.
In a post on the UNDP website, he said, “This being done through combining differentiated premium subsidies based on the coming together of a consortium of insurers and development partnerships to expand protection for farmers facing climate and production risks.”
The Uganda Agriculture Insurance Scheme has now covered over 1m farmers with agriculture insurance products and services, with over UGX53.8bn ($14.5m) paid in claims, helping farmers recover from shocks, delivered through a consortium of 14 licensed insurers.
UNDP Uganda, under the Financial Resilience in Agriculture initiative, supported the Ministry of Finance, Planning and Economic Development to secure a 10-year extension of the Uganda National Agricultural Insurance Scheme and strengthen the market ecosystem through the agriculture consortium.
Mr Atiku said, “A major challenge has been that poor and vulnerable customers are often seen as too risky, but in many cases, they are simply underserved. With the right knowledge, sensitistaion, customised insurance products, partnerships, distribution channels and trust-building mechanisms, inclusive insurance can provide wide community safeguards and expose new market opportunities. Inclusive insurance can be a key element in advancing national development priorities.
“Embedded finance is one way to achieve this. Insurance can be integrated into mobile money, digital lending, input finance, agricultural value chains and other services that people already use.
In building resilience, Mr Atiku said that Uganda’s insurance industry can focus on five priorities”
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Adopt an innovation mindset by testing new solutions responsibly and learning quickly from what works.
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Build inclusive markets by designing products that respond to the needs of women, youth, farmers, micro, small and medium enterprises, and informal workers.
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Invest in data and digital infrastructure so that underwriting, pricing, distribution and claims can become faster, fairer and more efficient.
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Move from standalone products to ecosystems that connect insurance with credit, savings, inputs, technology and advisory services.
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Embrace the industry’s wider role as an architect of resilience, helping Uganda protect livelihoods, strengthen food security and adapt to climate change.
In Uganda, agriculture and small businesses remain central to livelihoods and economic activity, which accounts for close to 26% of the Gross Domestic Product and employs 65% of the workforce.