Kampala — MICRO-ENSURE has launched a crop insurance cover that will guard farmers against damage.

"Microfinance institutions have been considering lending to farmers as being risky for fear of drought which according to them makes it impossible for farmers to repay loans," Flora Kaheru, the country manager, said during the launch at the Speke Resort Munyonyo.

She said the cover, also known as weather-based insurance, is designed for regions like Karamoja and Teso whose crops face perennial destruction by either floods or drought.

Kaheru said crop insurance products can be designed using an index such as rainfall to determine if and when a payout is due. "It protects the farmers and the lenders which enables rural credit programmes to expand with reduced risks," she said.