In the agricultural sector, NIGERIA annually accounts for about $ 20 billion. US due to the inability of insurance companies to create products for small farmers. This was stated by stakeholders in the agricultural sector, speaking at a conference and exhibition of national insurance brokers in Lagos in 2018, noting that the lack of insurance coverage for small farmers is one of the reasons that livestock production is not growing in Nigeria.
Speaking on “Insurance Industry: Survive and Prosper”, Dr. Colade Adebayo, Executive Director of Zynosism Nigeria Ltd, said that the insurance sector should create products that attract small farmers. Adebayo said: “The lack of insurance products for small farmers in agriculture amounts to about 20 billion dollars a year. We need insurance products that will unite small farmers and provide them with coverage. Thus, insurance companies must deal with poultry associations, rice farmers association, etc., so that agricultural products can be improved.
“Risk is an integral element of the agricultural industry, but the problem we face is that we do not have an insurance partnership to cover most of our risks. The livestock breeders association usually organizes annual agriculture forums where we get together to discuss issues. For years, we have always invited interested parties from other sectors to plunder minds together in the direction of promoting business in agriculture. More than ten years ago, when we had this forum, while we had many representatives from other sectors, we see only one person from the entire insurance industry. This is not good for the insurance sector. ”
Speaking further, Mr. Biodun Oladapo, Chairman of the SME Trade Group, Chamber of Commerce and Industry of Lagos, LCCI, said that the livestock business is still lagging behind in Nigeria, because for many years there was no insurance support to give it a boost.
Oladao said: “We are seeing a slight increase in livestock production in the country, because we did not have enough insurance support. Any farmer who has insurance coverage has received it today because they need bank loans. Unfortunately, no bank in Nigeria will provide loans to farmers without insurance coverage.
“For farmers who have insurance, when a cow enters a rice farm and eats rice, insurance companies will tell you that“ a rice-fed cow ”was not covered. In the end, no claims will be paid, and the farmer will be left to fend for themselves. Such incidents have contributed to the depletion of many farmers, and this experience causes apathy between us and the insurers. Therefore, in the insurance sector there is a need to introduce products that will cover all our risks. ”
Responding to concerns raised, the president of the Nigeria Insurers Association, NIA, Mr. Tope Smart, said that the insurance industry needs to work with the agricultural sector in its survival and prosperity measures.
Smart said: "The insurance sector is at risk of survival, so it must reconsider the strategy and introduce innovations in order to continue to exist."