Known as index-based livestock insurance (IBLI), payouts are triggered when satellite images show that grazing lands in the region have deteriorated to the point that herders are expected to be losing more than 15% of their herd. The current readings for which indemnities are now being paid show that between 18 and 33% of livestock have been lost to drought this season.
The Marsabit District alone is home to some 86 thousand cattle and 2 million goats and sheep, which generate millions of dollars in milk and other products and serve as the herders’ main source of sustenance and income.
The International Livestock Research Institute (ILRI) estimates that up to one-third of all livestock in the region has perished during the current drought.
The insurance project was developed by ILRI working in partnership with Cornell University and the Index Insurance Innovation Initiative program at the University of California at Davis.
“Drought insurance is one important way to help livestock keepers maintain food security even in very harsh environments,” said Andrew Mude, the IBLI project leader at ILRI. “Insurance is not by itself sufficient, but if it is accompanied by other risk-reducing strategies, such as better access to grazing lands and watering areas, then the pastoralist approach, which some people dismiss as a lifestyle of the past, emerges as a very effective way to meet future food needs.”
“This is all still a work in progress,” said Jimmy Smith, Director General of ILRI. “But the fact that our relatively inexpensive approach to estimating livestock deaths seems to be accurate, could open the door to making livestock insurance widely available in many parts of Africa.”
Read the full report on ILRI’s website.