NAIC is working on insurance for cattle – MD
Mr. Bashir Haliru Binji is the acting Managing Director and Chief Executive Officer of the Nigerian Agricultural Insurance Corporation (NAIC). He has the mandate to ensure that farmers are identified and compensated when they suffer losses from natural ha
In what ways does the NAIC offer compensation to farmers?
Basically, we have policies for crops and livestock. For crops, we cover flood, drought, fire, pests and invasion of farms by wild animals, while for livestock we cover mortality, accidents as a result of diseases, fire and flood.
Our contract is that of indemnity, so compensation is based on what a farmer actually lost.
How do farmers get registered into the scheme?
After a proposal form is filled, the NAIC advises on the kind of premium to undertake. After a premium is paid, the organisation carries out a pre-insurance inspection to ensure that the farm really exists. We look at the number of hectares, among others, and issue a Conditional Provisional Insurance of Certificate, followed by a policy document.
Farmers can insure with us through different distribution channels. Some of the farmers are loan farmers; they take credit from the banks, making the banks do the insurance on their behalf. Also, some farmers come through their co-operatives, some through their agents, while others go through brokers and some come to us directly.
How long does it take to get paid for your claim?
It all depends on the documentation. How quickly a farmer reports the claim, and how quickly he makes available the claim substantiating documents. For example, if it is a poultry farmer, we need a post-mortem report from a veterinary doctor, and the earlier it is provided, the better for the farmer. But all things being equal, within a month, the claim can be compensated.
Have you received complaints of late compensation from aggrieved farmers?
Yes, a lot. We receive such complaints all the time because insurance contract is a bit complex and technical. There are so many things that need to be put in place for a farmer to access compensation. So we have a lot of dissatisfied customers, a lot of exaggerated claims and a lot of claims that are non-existent. But there are certain conditions that a farmer must meet before we can pay for a claim. There has to be a cover in place, you must pay premium. A loss must occur within the period of insurance and farmers must also follow the approved agronomic practices. If it is violated, there must be penalty.
Notification is also very important. In our policy document, it is stated that problems should be reported between 72 hours for livestock and seven days for crops. So, if it is not within the time frame, that is a violation of policy condition of notification.
Does the NAIC offer compensation to farms destroyed by cattle?
We are having so many requests Daily Trust on Sunday for that type of insurance. It is part of what we are looking at under our new product development. What we want to do now is to insure the cattle, not the farms, so that the cattle can have a liability insurance, whereby if they go into someone’s farm and they destroy it, we will compensate. It is something we are working on.
What are some of the packages you have for small, medium and large scale farmers?
We have the peril policy for a farmer who is planting one crop and for those planting multiple crops. There is also a multiperil policy that covers not only diseases but other challenges. There are challenges with public perception and distribution channels. We need to have agents all over. What we are advocating is for the agricultural insurance to be made compulsory so that farmers can be properly compensated It is a comprehensive cover. For large scale farmers, we have the Agricultural Investment Policy. This time, it gives a comprehensive cover across the value chain, from production to transportation, warehousing, storage, to processing. For exporters, we have Marine Cargo Insurance, and for tractor, equipment and farm implements.
What other support do you give to farmers aside insurance?
Other supports are in areas of training, especially the extension service workers that are there with the farmers. We give risk management and advisory services to farmers because we monitor this project. We tell them the best farming methods and practices to deploy.
We are also involved in a lot of publicity and enlightenment for the farmers to appreciate the need for insurance. We also make sure that our claim processes are very effective and efficient so that we can build the confidence of farmers.
Above all, the subsidy that comes from government through the NAIC is also a very important element because without this subsidy, farmers would not be able to pay for this insurance.
Was the NAIC able to compensate tomato farmers whose farms were ravaged by the pest, Tuta absoluta last year?
Unfortunately, most of those farmers did not insure with the NAIC. So like I said, cover must be paid before you get compensation.
What are the challenges of agro insurance?
There are challenges with public perception and distribution channels. We need to have agents all over. What we are advocating is for the agricultural insurance to be made compulsory so that farmers can be properly compensated.
How practicable is it to make agro insurance compulsory?
We are involved in a lot of advocacy at the highest level. Insurance, as a risk management mechanism, is part of every agricultural policy.
We are thinking of having local government insurance committees, then state insurance committees so that all these cooperatives at the local level are involved in the payment of premiums and claims.