Initially, insurance was not considered for the PFFJ which is the government’s flagship agricultural programme to increase productivity, whereas targeted crops under the programme, namely, maize, rice, soya were susceptible to diseases and pests.

Experts say insurance should be part of any risk management strategy, especially for the agricultural sector which is susceptible to many challenges such as uncertainties in weather conditions which subsequently affects farms yields.

In an interview, the General Manager of the gAiP, Alhaj Ali Mohammad Katu, said there was a missing link between agriculture insurance service providers and institutions such as the MoFA unlike a country such as Kenya where insurance penetration is over 10 percent, their livestock insurance is subsidised by the state so that when there is drought and its declared, at least the payout could go to the farmers so they can buy fodder from other places.

He said the recent fall armyworm (FAW) invasion on crop farms would require the government to support affected farmers, whereas insurance compensation could have sorted the farmers out, while the government extended support to other farmers.

The discussions are in the initial stages but we hope that we can make a headway, he said.

Agric insurance

Alhaj Katu said that generally, insurance penetration was low in Ghana with the figure at two percent which made that of agricultural insurance insignificant.

“Insurance in this country is relegated to the background. When you take any business plan, you don’t find insurance in it,” he said.

He said since the inception of the gAiP formed under the auspices of the Ghana insurers Association (giA), crop insurance uptake by farmers have been slow and not up to expectation and would require more sensitisation and awareness creation of farmers to understand the need to take up insurance.

“We are not only looking at farmers but other stakeholders such as agribusinesses, lending institutions such as the banks to lend to Agric.

Banks will lend to others in the value chain apart from production which they see as high risk and that’s when we come in and then we are able to sensitise them and they appreciate that fact that they should be able to lend,” he said.

Capacity of GAIP

the gAiP needs transformation to widen its scope because it was set up as a project and is now metamorphosing into a programme and so it should be able to increase staff strength and other logistics to ensure a wider coverage.

“the best way to go is to have a good collaboration with the financial institutions so that there will be bundling of insurance with a credit facility that will enhance distribution", Alhaji Katu said.