Policymakers Regaining Their Decade's Failed Voice On Agric Insurance As Climate Change Bites Harder

The failure to implement agricultural insurance despite years of promises has led stakeholders to realise that risk and loss in agriculture is more pronounced today than at any time in the country’s history. Hence, the call for agricultural insurance has been made but they have not taken it seriously. ODIMEGWU ONWUMERE in the article points out that if the government had made good on its promises, it would have been in the best and wisest interest of farmers, big, medium and small, to insure their crops for the life of the farm. The article notes that according to the opinion leaders, the “goals of Vision 2020 and the MDGs” were not achieved due to the lack of urgent measures being taken to protect Nigerian farmers through proper insurance programmes. The article suggests that as a result of these failed attacks on agricultural insurance, inadequate weather infrastructure, unsupportive policy and legal frameworks, lack of capacity building in the insurance industry and scarcity of the insurance industry are unfortunately issues that need to be addressed from today. Public awareness among Nigerian farmers is a major bottleneck in providing weather-based risk management services to farmers.

More than a decade later, the Nigerian Agricultural Insurance Corporation (NAIC) reiterated the need for farmers to insure themselves against the adverse effects of climate change. In January 2012, the then Climate Change Adviser to the Federal Ministry of Water Resources, Professor Lekan Oyebande, had called on farmers to insure their properties against the effects of climate change. However, the call was apparently not taken seriously.

According to Oyebande, "What we are experiencing now in this sector is still small compared to what we are expected to see in the coming decades. It could actually get even worse, so we really need to be prepared." To him, the insurance was an adaptation measure against the adverse effects of future climate change, noting that agriculture was a key economic sector in Nigeria.

The Nigerian Bureau of Statistics, says agriculture provides direct employment to about 30% of the population and contributes about 24% of the country's GDP, but threatened by climate change.

The source added that the direct impacts of climate change on Nigerian agriculture include fluctuations in rainfall and temperature, altered growing seasons, shifts in planting and harvesting calendars, and difficulties with water supply. Over the years, it seemed as if Prof. Oyebande's arguments had gone to waste, but his rather prophetic herald was not and he was not standing alone in that postulation.

Realizing Oyebande's Warning?
The Minister of Agriculture and Food Security, Senator Abubakar Kyari, through his information team, Mr. Ezeaja Ikemefuna, called for the establishment of district-level Agricultural Insurance and Weather Advisory Centres by October 28, 2024, to support the adaptation and resilience of smallholder farmers to climate change. Something that has been neglected over a decade of concern by stakeholders?

The Minister was represented by the Director-General of the Federal Agricultural Extension Service, Dr. Deola Tayo Lord Banjoo, who made the call during a roundtable on Agricultural Insurance and Climate Change Advisory held in Abuja.

Sen. Kyari explained that the importance of insurance coverage for farmers cannot be overemphasized, as it helps protect investments, increase productivity, and improve farmers’ livelihoods, which in turn helps in achieving the country’s agricultural goal of achieving food security.

He noted that the frequency and severity of floods, droughts, and other environmental disasters have also increased as a result of climate change. Farmers are particularly vulnerable to these disasters and are set back whenever a disaster strikes as their investments are undone.

The National Agricultural Extension, Research, and Liaison Service (NAERLS) also advocated for providing insurance to farmers by December 3, 2024, to mitigate the devastating impacts of climate change on food security. The director said policymakers must prioritize funding for climate-resilient agriculture efforts, ensure farmers have access to affordable inputs, and improve insurance coverage for climate risks.

While Professor Lekan Oyebande had announced that the livelihood impacts of climate change in Nigeria have yet to be addressed, the NAERLS Director in 2024 said, “Climate change is no longer a distant reality. Its impacts are reshaping ecosystems, altering rainfall patterns, and threatening food security around the world."

The stakes could not be higher for a country like Nigeria, where agriculture contributes significantly to GDP and employs over 70 percent of the rural population, said Prof. Kabiru Bala, Vice Chancellor, Ahmadu Bello University (ABU), Zaria. He added that the global climate crisis has left no sector untouched, adding that agriculture, the backbone of the Nigerian economy, is at risk.

According to him, "We need to rethink not only how we produce and distribute food, but also how we conduct research, provide extension services, and support farmers in the face of new environmental challenges."

Given this reality, Nigeria's Federal Ministry of Agriculture and Rural Development (FMARD) has determined that there is a need to develop a National Agriculture Resilience Framework that will set out a path to better adapt Nigeria's agriculture to climate change shocks and stresses, (but so far no such effort has been made?) The policy is only on paper.

Dr. Adebisi Alaba, CIAT Regional Director for Africa, said the impacts of climate change pose major challenges to farmers and food security in Nigeria and across Africa. While the climate cannot be controlled, government agencies can mitigate it by promoting agricultural risk management mechanisms through weather insurance.

Result Of Failed Agriculture Insurance Policies

Experts said that today, the results of these failed agricultural insurance onslaughts are inadequate weather infrastructure, unsupportive policy and regulatory frameworks, lack of capacity building in the insurance industry, and lack of public awareness among Nigerian farmers, which have become major bottlenecks in the delivery of weather-based risk management services to farmers.

The then Director-General of the Nigerian Meteorological Agency, Dr. Anthony Anuforom, in his speech, noted that in most cases, the weather does not meet 100% of the targets of farmers in the country.

According to him, "Statistics show that the average annual loss from weather-related events was $1 billion in 1960, $35 billion in the 1990s, $35 billion in 2004, and almost doubled by 2005.

"Between 1980 and 2005, there were approximately 7,500 disasters around the world, killing more than 2 million people and causing economic losses of more than $1.2 trillion.

"And more than 90% of that is due to weather and climate change, resulting in losses of about $80 billion per year, of which only a quarter is insured.” The case has increased today!

Oyebande Was Not Listened To Neither This
In March 2011, at the end of a two-day conference in Abuja on "Climate Change-Based Microinsurance: Protecting Nigerian Farmers," a communique was issued stating that over 90% of agriculture in Nigeria is dependent on rain-fed farming systems.

The communique stressed that insurance plays a key role in encouraging banks to lend to the agriculture sector and that since less than 1% of Nigerian farmers have access to insurance, risk perception of financial institutions limiting the flow of funds to the insurance sector is a concern.

Thus, the communique states that “Nigeria will introduce a climate insurance scheme for farmers.” But this was not realized by 2024, even though stakeholders at the two-day meeting recognized the important role of agriculture in employment, income generation, poverty reduction, and raw materials production.

Proper Steps Not Taken
The “Vision 2020 and MDGs targets” were not achieved as urgent steps were not taken to protect Nigerian farmers through proper insurance schemes, according to opinion leaders.

The Nigerian Agricultural Insurance Corporation (NAIC) said insurance is essential for farmers due to the adverse effects of climate change.

At the International Fund for Agricultural Development (IFAD) “Financial Education for Farmers” workshop held in Enugu in June 2021, officials stressed the “need for insurance for smallholder farmers.”

According to one of the speakers, risk and loss in agricultural practices is more pronounced today than in the country’s history.

It has been in the best and wisest interest of farmers, whether large, medium, or small, to insure their crops for the duration of their farm life. Those who work in the agricultural value chain or value-added sector can insure their working and processing equipment by paying a small premium.

“Insurance acts as a safety net in case something goes wrong, to ensure that losses are recorded due to natural disasters or other unforeseen circumstances and farmers are not thrown out of farming altogether,” the official said.

As if that were not enough, In June 2024, a senior UN official in the country said that despite its enormous potential, Africa's most populous country continues to struggle with various challenges that affect people's lives and cause conflicts over key resources.

Mohammed Malick Fall, the UN Resident Humanitarian Coordinator in Nigeria, highlighted the alarming impacts of climate change while speaking to reporters at UN headquarters in New York.

The official said the country is experiencing climate-related shocks that are causing displacement and fueling conflicts, highlighting clashes between farmers and herders over dwindling resources.

The conflicts are further exacerbated by the climate crisis, forcing pastoralist communities to leave their traditional lands in search of better grazing opportunities.

Fall also briefed reporters on the government's efforts to implement economic reforms, including through the "Renewed Hope" program launched last year. Economists expect that inflation, which is currently a concern, may recover and fall by the end of the year.

"But in the meantime we will see price increases, especially food prices, which will have a negative impact on people's ability to live a decent life," Fall said.

Odimegwu Onwumere writes from Rivers State via: [email protected]