Nairobi — Crop and livestock farmers in Kenya will soon benefit from insurance to mitigate the risks associated with the occupation.

According to the watchdog body, the Association of Kenya Insurers, about seven local insurance companies have already come up with tailor-made products that will among other things, cover crop and animal diseases, drought, hailstone, floods and death of animals.

"Farmers will no longer suffer the huge losses linked to such risks if they buy these new products," said Tom Gichuhi, the Association of Kenya Insurers, executive director.

In the recent past, an increasing number of players in the sector have been focusing on how to help farmers access insurance cover. Only a few weeks ago, the International Finance Corporation, European Commission and the Netherlands Foreign Affairs Ministry announced they were working on the Global Index Insurance Facility that will help protect farmers and vulnerable communities against natural disasters that are notorious for wiping out their livelihoods and trapping them in poverty.

The Global Index Insurance Facility targets catastrophic events, depending on their severity.

For instance, insurance will be paid out in the event of a windstorm of a certain category, or earthquake registering a certain magnitude on the Richter scale.

According to Mr Gichuhi, the system has been successful in countries like Malawi, India and the Philipines.

Farmers who are insured against such risks will also attract loans from financial institutions with the cover acting as "collateral."

Pauline Kamande, operations manager, at Blue Shield Insurance Company, said agricultural insurance will help farmers put to rest constant worries about how to pay debt and meet overhead costs.Blue Shield Insurance is among the Kenyan companies that are developing insurance products for farmers.

Some of the products available in the market include poultry insurance, crop insurance and catastrophe insurance. Others are crop hailstorm insurance, crocodile insurance and crop revenue insurance.

This is not the first time insurance companies in Kenya are attempting to provide agricultural insurance. Between 1987-1988, Kenya National Assurance and Kenindia Insurance companies came up with covers for livestock farming, but they did not last long.

Mr Gichuhi, who worked for Kenya National Assurance then, says the failure was due to "unending fraudulent claims" from the farmers that led to serious losses to the insurers.

"Farmers colluded with local veterinary officers to falsify claims of deaths and diseases!" he told The EastAfrican.