Regional governments want insurance cover cost of disaster in Agri-sector
REGIONAL GOVRNMENTS WANT INSURANCE COMPANIES COVER THE COST OF NATURAL DISASTERS IN THE AGRICULTURE SECTOR rather than bracing farmers losses from the national treasury.
Guyana is in the vanguard of this novel move when its Agriculture Minister, Zulfikar Mustapha, during the launch of Caribbean Week of Agriculture, signalled the Irfan Ali administration’s willingness to replace state funding with insurance coverage for losses suffered by Agri-farmers.
Mustapha, as Chairman of the Ministerial Task Force (MTF), outlined the need for establishing sustainable agriculture insurance products in vulnerable member states because of worsening impacts of catastrophic climate change in recent years which pose several economic challenges for vulnerable CARICOM countries.
Last year, Guyana experienced one of the most devastating floods in the country’s history which wiped out some 90 percent of the country’s agriculture sector. Barbados, Jamaica, Suriname, St. Vincent and the Grenadines, and Trinidad and Tobago suffered a similar fate.
MTF Chairman Mustapha is encouraging his regional colleagues to get backing from regional financial insurance institutions to develop agriculture insurance products geared at strengthening the region’s disaster recovery efforts.
There is welcome news according to information from the 8th CARICOM Ministerial Taskforce (MTF) meeting held last Friday.
“The MTF has received presentations on two areas which included a possible agriculture insurance product for the region by a regional company pioneering such a product in a member state and outlining the elements for the establishment of a regional agricultural insurance product. This is very critical for us, in the Caribbean, to implement such a product and ensure that our farmers are targeted,” Mustapha announced at the meeting.
Mr. Shaun Bough, Programme Manager, Agricultural and Agro-Industrial Development at the CARICOM Secretariat in Georgetown, said the MTF’s Agriculture Insurance Technical Working Group met representatives of GraceKennedy Limited, one of the Caribbean’s largest and most dynamic Food and Financial corporate entities, to discuss the progress of developing and implementing the such a product.
“Late last year, we received a presentation from GraceKennedy Insurance out of Jamaica. They had presented on a particular product that they have ongoing in that member state and expressed an interest in scaling up and introducing it to the rest of the region,” Bough explained.
According to the CARICOM official, GraceKennedy “indicated that they have now been able to put a dedicated project team to get this product up and running, and that they are near completion of negotiating with their reinsurance to carry the product.”
“They have also submitted an implementation work plan and programme to which they have committed to. All in all, it amounts to a possible product being introduced by the first half of 2023,” Mr. Bough said.
He said the MTF’s technical team has also engaged the Caribbean Catastrophe Risk Insurance Facility (CCRIF) on the regional blueprint.
“At our last meeting, we received a presentation from the CCRIF which indicated that they had several products available but in particular, they had a livelihood product that they were ready to go to market with. The technical working group also met with them recently and they indicated that they are prepared to launch their Livelihood Protection Policy in December 2022.”
“They’ve also indicated that their insurance partner will be Garden Insurance Group Limited and that they identified Belize, Grenada, Jamaica, St. Lucia, and Trinidad and Tobago as countries to launch the pilot for the product. This product is also intended to be up and running by the first half of 2023,” Bough said.
In the last decade, climate change has hurt more CARICOM Small Island Developing States (SIDS) inflicting severe economic damage through increased instances of flooding, drought, and volcanic eruptions.
