Agricultural insurance - Kenya

In June 2014, Kilimo Salama became the company ACRE - see the Overview page of this section.

The text below provides information on our activities before the creation of ACRE.

Insurance, a busy helpline and confidence

In Kenya, Kilimo Salama was a partnership between our Foundation, the Kenyan insurance company UAP, and Swiss Re Corporate Solutions. The initiative developed and offers insurance for Kenyan farmers so that they can feel confident investing in their farms, and produce enough food to feed their communities. The partnership developed a range of products, and insured thousands of Kenyan farmers.

The Kilimo Salama Model
Kilimo Salama means "safe farming" in Swahili.
 Insurance should be simple, affordable, and relevant to small farmers. Kilimo Salama was [CB2] an insurance program designed specifically for smallholders, helping farmers cope with climate change and devastating weather shocks.
By the end of 2013, Kilimo Salama insured 187,000 farmers in three countries. Previously, few of them could afford such cover because of the high costs. Traditional crop insurance relies on expensive farm visits to verify claims. Kilimo Salama did not visit the farms, but instead used automated weather stations and mobile payments. These dramatically reduced administrative costs, finally enabling a premium price that millions of farmers could afford.

Kilimo Salama Helpline
This served farmers (with any size of land-holding) who wanted further information on Kilimo Salama.

The Helpline was a partnership between Kilimo Salama and mobile operator Safaricom. It operated daily from 6 a.m. to midnight. Call agents had Agriculture degrees, customer service experience, and training on inputs, pests and Kilimo Salama products. They provided insurance information, agronomic advice, feedback, issue resolution, clarification, and direction to sales outlets.

From 2011 to the start of 2014, the Helpline answered about 50,000 calls - more than 400 per week.


A stockist at Tumaini Agricultural Supplies in central Kenya selling Kilimo Salama insurance

Kilimo Salama’s use of technology was the key to the microinsurance product’s affordability and the model’s scalability. Almost all Kilimo Salama’s clients were smallholders scattered throughout rural areas. 

Index insurance uses weather data from satellites and automated weather stations as a proxy to estimate farmers' harvest situation. At the end of each growing season, the collected weather data are automatically compared to an index of historical weather data. If the season's rainfall was, for example, 15% above or below the average, the insurance payout owed to client farmers is calculated and sent. There is no "claims" process.


An automated weather station installed in East Africa. The station collects and automatically transmits measurements to the Kilimo Salama cloud-based server every 15 minutes.
By reducing their risks, insurance encourages farmers to invest in their farms. This way, they can raise their yields. Findings from Kilimo Salama's impact survey in October 2012 suggest that insured smallholders stepped up their farm investment by about 20 percent.

Insurance products
Kilimo Salama came in various forms and covered a wide range of risks:

Loan-Linked Insurance

This was intended for smallholders with a loan and input package from a microfinance institution (MFI) worth $100 or more. Farmers produced corn on less than a hectare using improved inputs, and received agronomic training from the MFI's field agents.
 The MFI increased smallholders’ productivity and food security by linking them to credit, inputs, and extension services. Kilimo Salama insured the farmers' loans for buying certified seed and mineral fertilizer.

Contract Seed Grower Insurance

Kilimo Salama products could easily be adapted for large-scale producers. This one was for farmers contracted by a company producing certified seed on more than 20 acres and insuring an average of $650 per acre. These experienced larger-scale farmers received advice from the seed company and invested heavily in fertilizers and crop protection.
The seed company and Kilimo Salama partnered to provide insurance to certified corn seed growers. The seed company paid the premiums at the start of the season. It later deducted the cost from the payment made to farmers for their harvest delivery.  

Dairy Livestock Insurance

This was intended for farmers with higher-yielding cows, delivering milk to dairy cooperatives or receiving a loan to purchase a cow from a lending institution.
The livestock cover was offered in partnership with a co-op or a lending institution. The former paid the premiums up front and deducted them from the payments to farmers for milk deliveries; the latter combined the cost of insurance premium with the loan. The cover was linked to an animal care package and vaccines.

Replanting Guarantee
Farmers purchasing certified seed or fertilizer could choose the replanting guarantee. A seed company would include the insurance premium into the price of seed. Each bag contained a scratch card with a code. To register for the insurance, farmers text the code to Kilimo Salama. The replanting guarantee began at registration and ended after two weeks. If there was a drought in that period, the farmer received an SMS voucher for a new bag of seed to replant within the same season.

News and articles relating to Kilimo Salama

  • In October 2015, the Spanish paper El Pais wrote about "Microseguros contra el cambio climático".
  • (Artikel auf Deutsch) Im März 2014 schreibt die NZZ-Zeitschrift Equity über die mobile Telefonie in Kenia. Darin kommen unter anderem Kilimo Salama wie auch Farmforce zur Sprache, eine Software-Plattform unserer Stiftung.
  • In February 2014, the IFC signs two new grant agreements with our Foundation. Funds of $3.9m will help expand index-based insurance to a million farmers. Tanzanians will now also benefit. Kenyan media coverage includes a film. Among other outlets reporting is the Shanghai Daily.
  • Here is the January 2014 review of Kilimo Salama.
  • In November 2013, Kilimo Salama publishes testimonials from farmers with dairy insurance. See what they say.
  • Here is a film made in connection with the 2013 Tech Awards, at which Kilimo Salama won the Flextronics Economic Development Award.
  • October 2013: Kilimo Salama wins an award from AON for innovation.
  • In February 2013, Kilimo Salama extends insurance in Kenya to dairy cows. Here are the media release and a local TV clip.