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Kenya: New livestock insurance product makes use of satellite images

Kenya’s UAP Insurance has launched a product for pastoralists as drought prevails in various parts of the country.

UAP Insurance has partnered with the International Livestock Research Institute (ILRI) to develop a model for drought risk assessment in arid and semi-arid areas.

UAP managing director James Wambugu said that the insurer has also partnered with Equity Bank to develop a distribution model for the policy among the pastoralists.

“We have rolled out the index-based livestock insurance policy in Marsabit district after two years of piloting that generated valuable lessons and we are very optimistic that it will give the pastoralists an easier, affordable and accessible mechanism to protect their livestock,” he explained.

He said that UAP, ILRI and Equity Bank had worked for the last two years to develop and introduce an annual livestock insurance policy that compensates the pastoralists in the region for their livestock that die from lack of adequate pasture as a result of drought. The insurance policy is distributed by Equity Bank.

The policy will enable pastoralists to restock animals they may lose following a severe drought. After a drought has occurred and an insured pastoralist has suffered livestock losses, compensation is done based on average predicted livestock deaths over the cover period. Compensation is triggered after satellite images indicate that the drought conditions would result in predicted livestock mortality in excess of 15% of animals within a specific region.

The satellite pictures, which show the level of forage, allow the project partners to follow up on the severity of drought conditions. This information is then verified and certified by the Kenya Meteorological Department.

The policy was launched just a week after the Red Cross released a statement indicating more than 8,000 livestock had perished in the northern part of Kenya.

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