In this Interview with Yemisi Izuora, the executive secretary of the Nigeria Council Of Registered Insurance Brokers, NCRIB, Fatai Adegbenro says Brokers are deploying measures to reach Nigerian farmers to educate them on agriculture insurance
Agriculture insurance is evolving in Nigeria, how do you intend to create the necessary awareness among farmers?
The most important function of Insurance in Agriculture is to make sure people continue with their lives and businesses without hindrance. The things that can cause farmers not to continue with their production of food the way they are supposed to, due to risk of flood, fire disaster etc, all these can cause problems to farmers and to the populace that are beneficiary of Agriculture produce.
To forestall this, Agriculture Insurance will come to their aid. That is when their farm is disturbed by fire or by any other hazard, they will continue to be on the farm producing and return back to business, and have returns on their investments.
Insurance will produce the fund to start their farm business once again. Even the livestock farmers (poultry, piggery, cattle and other animals) may also experience attack in their farms may be diseases or thefts, and this may lead to distortion of their business due to loss of their animals, but with Agriculture insurance, they will be able to go back to business to avoid famine in the country.
Agriculture insurance gives farmers a lot of confidence against any loss, because nobody will want to invest if the risk is high and there is no guarantee that there will be compensation against any loss, but farmers are more confident that in case of any mishap, the insurance companies are there to compensate them.
Many companies are underwriting Agriculture apart from NAIC. Apart from their share capital, the companies still have Re-insurance arrangements as backup. The Re-Insurance gives gives succor to insurance companies and it enables them to take risk beyond their share capital and assist in paying claims that is beyond the companies capability.
Role of Brokers in all these?
The brokers are intermediaries, they bring farmers and underwriters together. The brokers are the one that will go to the village farmers and they are spread across the country. The underwriters are few, they cannot be at all these places, so we need the intermediaries who will meet the farmers, explain to them the role of insurance and assist them in choosing the different policies that will meet their need. It is the brokers that will arrange for policies that will meet the farmers need, handle the documentation and follow up.
On sensitization of Farmers?
Brokers have been sensitizing farmers even before now. About 3-4 months ago, the President was at the National Institute of Policy And Strategic Studies Kuru,( this is the body that gives directive to government on the direction to pursue) to give a lecture on the role of Insurance in driving Agriculture and why government should focus more on Agric, so brokers has been in the fore front all along.
In your own opinion, do you support CBN intervention in the sector?
There is no need for another intervention for Agriculture insurance, because insurance is a peculiar business that is well packaged. Many companies have been writing Agriculture apart from NAIC, it is only that the public don’t know, the modus oparandi of insurance companies is that apart from the share capital, the company still have re-insurance arrangement as backup, Re-insurance gives them sort of succor, it increases your share capital. Insurance is a peculiar and technical business where a lot of check and balances are put in place to protect the operators, so that in case of any catastrophe or claim, the Re-insurance will be there.
It may surprise you that any risk being taking in Nigeria, the underwriters may have engaged a Re-insurance in Asia, America or Europe. Insurance is an international business that has a lot of structures in place. Everybody can not be going to Government, we need to think it out.