Ghanaian Chronicle


Date published: November 12, 2012

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136 farmers in the Northern Region became the first recipients of claims under the Drought Index Insurance Product in Ghana offered by the Ghana Agricultural Insurance Pool (GAIP).

This marks a historic milestone in Ghana as it is the first time that the agricultural sector receives compensation for losses due to a shortfall of rain.


The payment took place at a short ceremony in Tamale, by the underwriter of the Pool, Ms. Angelina Yeboah. The Drought Index Insurance Product was offered in the Northern, Upper East, and Upper West regions to maize farmers with cover running from May to September 2012.


These farmers were facilitated by two NGOs operating in the Northern Region, namely: Innovations for Poverty Action (IPA) and ADVANCE (ACDI/VOCA). “We want to keep our obligation to the farmers by making payouts quickly in order to prove to them that GAIP can be trusted” said Kwame-Gazo Agbenyadzie, the Chairman of the Management Board of the Ghana Agricultural Insurance Pool.


The drought index insurance product is a risk-mitigating mechanism which works on the basis of rainfall measured at weather stations operated by the Ghana Meteorological Agency (GMet).


The payments under the Ghana agricultural insurance programme were triggered when weather stations at Tamale and Pong Tamale registered dry spells for the current season that were slightly above the pre-defined thresholds  set out in the contract.


For example, farmers around Pong Tamale weather station did not receive sufficient rainfall during the growth phase of the maize crop in August. The weather station measured 17 consecutive dry days during which the farmers hardly received any rainfall (i.e. less than 2.5mm per day).


Evelyn Debrah, the Agrometeorologist of GAIP added, “the rainfall recorded at Tamale and in particular, Pong Tamale weather station was insufficient, hence farmers experienced challenges during the crop cycle”.


Having in mind the impact of climate change over the years, Mrs. Debrah asked farmers “to keep insuring their crops in order to protect themselves against such risks.”


The Drought Index Insurance aims at protecting farmers, agro-processors, rural and financial institutions, input dealers among others, in the event of crop failure due to extreme weather conditions like droughts.


GAIP is well positioned to respond to weather challenges and will continue to design insurance products that will meet the needs of actors in the agricultural sector such as farmers, agri-input dealers, banks which finance agriculture as well as exporters.


Currently crop drought index insurance is being offered in six regions, namely: Northern, Upper East, Upper West, Brong Ahafo, Ashanti and Eastern.


The development of the Drought Index Insurance Product is a result of concerted efforts by the stakeholders like the German International Cooperation (GIZ), National Insurance Commission (NIC), the Ghana Insurers Association (GIA), Ministry of Finance and Economic Planning (MOFEP), Ministry of Food and Agriculture (MOFA) and the Ghana Meteorological Agency (GMET) with support from Swiss Re, a reputable international reinsurance company.


In 2011 the Ghana Agricultural Insurance Pool was set up comprising of 19 Non-Life Insurance Companies.


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