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Innovative Insurance Helps Pastoralist Families Prepare for the Future

For pastoralists in Kenya, nothing is more important to their livelihoods than their livestock. When animals thrive, pastoralists can feed their families and make a decent income. But when disaster strikes, they can easily become mired in poverty.

That’s where index-based livestock insurance comes in. What began as a small pilot research project over a decade ago has now grown into a widely-scaled component of Kenya’s comprehensive government social protection program.

Since 2015, the Government of Kenya has been working with a broad group of partners to successfully implement the Kenya Livestock Insurance Program (KLIP), an insurance product that triggers payments when remote sensing indicates that a scarcity of forage, or food on the ground, will lead to livestock losses. This insurance helps pastoralists manage risk brought on by drought and avoid costly coping mechanisms—such as skipping meals or taking their kids out of school—that can make or keep them poor.

The successful scaling of index-based livestock insurance in Kenya is largely due to partnerships between the private and public sectors. Researchers from leading institutes worldwide have joined the Government of Kenya and the local insurance industry to create a coalition to tackle entrenched poverty among the nation’s pastoralists.

“As the private sector, we are determined to commercialize this and make it profitable to us as private companies but also beneficial to our customers,” said Charles Wambua, head of microinsurance and agribusiness for APA Insurance, a Kenyan company.

The Government of Kenya has recognized that providing full subsidies for KLIP is not the most effective way to reach the maximum number of people. Instead, they are investigating ways to partner with local insurance companies to incorporate smarter government subsidies that require pastoralists to make partial payments.

This shift could further catalyze the market for private insurance companies to share in a profitable solution that moves more people out of poverty. Compared to emergency government aid, index-based livestock insurance is a tool for pastoralists to manage their own risk and to build the resiliency necessary to climb out of poverty.

Pastoralists and their representatives are eager to take action to build their resilience, protect themselves against drought and move away from dependency on government food aid and cash transfers, said Andrew Mude, lead researcher at the International Livestock Research Institute and the Feed the Future Innovation Lab for Assets and Market Access at the University of California, Davis. 

KLIP began in 2015 with 5,000 pastoralists in northern Kenya. The Government of Kenya is planning on providing insurance to between 75,000 and 100,000 pastoralist households by 2020. This type of resilience-building tool has the potential to eventually reach the 50 million pastoralists across the Sahel and sub-Saharan Africa.

The Feed the Future Innovation Lab for Assets and Market Access at the University of California, Davis has supported index-based livestock insurance research since its inception, and is currently conducting multiple ongoing index-based livestock insurance projects. For more information, visit 

To learn more about how the Government of Kenya is taking ownership of investing in long-term food security while also sustainably addressing immediate, humanitarian needs, check out how Kenya’s County Governments are taking the lead in food assistance and promoting local ownership.

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