New government initiative offers climate insurance to 250,000 Kenyan farmers

The government has introduced a climate risk insurance component to its National Fertiliser Subsidy Programme, aiming to protect smallholder farmers from climate-related shocks such as droughts and floods.

Under the new initiative, farmers who receive subsidised fertiliser will automatically be enrolled in an insurance scheme that offers financial compensation for losses caused by extreme weather events.

Touted as the first of its kind in Kenya, the programme will initially cover around 250,000 crop farmers during its pilot phase, with plans to scale up nationwide.

The rollout targets 11 counties: Makueni, Machakos, Kisii, Migori, Meru, Nyeri, Trans-Nzoia, Kakamega, Kericho, Nakuru, and Uasin Gishu.

The Ministry of Agriculture and Livestock Development said the program will later expand its reach and incorporate innovative public-private financing models to reduce farmers’ vulnerability and encourage long-term investment in agricultural inputs.

The initiative is being implemented in partnership with Pula, Bayer Foundation, Lemonade Foundation, SOMPO Digital Lab, and Etherisc.

Build resilience

“This marks a major milestone in the country's strategy to build resilience among smallholder farmers,” the Ministry said in a statement on Monday.

The insurance component is integrated into the distribution of subsidised fertiliser, aligning with the government’s broader objective to promote climate-smart agriculture and the use of data-driven tools to boost productivity.

According to National Cereals and Produce Board (NCPB) Managing Director Samuel Karogo, the initiative will serve as a safety net for smallholder farmers—especially those in Arid and Semi-Arid Lands (ASALs)—while also encouraging greater adoption of subsidised fertiliser.

“Agricultural insurance is a step in the right direction, especially now that climate-related risks are not a distant threat to our livelihoods. This partnership is critical as it will not only protect farmers from risks such as drought and floods but will also promote a sustainable safety net for our farmers, mainly those in Arid and Semi-Arid areas,” Karogo said.

He noted that the programme will boost farmer confidence in the fertiliser subsidy scheme by providing value-added services.

This season, all farmers registered in the Kenya Integrated Agriculture Management Information System (KIAMIS) will be automatically enrolled in the insurance program when they receive subsidised fertiliser. Each farmer will receive coverage worth Sh7,000—equivalent to the value of two bags of government-supplied fertiliser.

“The programme will improve uptake and confidence in the fertiliser subsidy program by offering value-added services,” Karogo said, noting that the insurance coverage amount and the number of beneficiary counties will be scaled up in subsequent seasons.

Empower vulnerable groups

Bayer Foundation’s Head of Public Affairs, Science & Sustainability, Africa, Mildred Nadah Pita, said the partnership aims to empower vulnerable groups within the farming community.

“This partnership is about creating meaningful access to resilience. At Bayer Foundation, we believe that insurance shouldn't be a privilege for a few, but a tool that empowers underserved farmers, especially women and youth, to thrive in the face of climate change,” Pita said.

Dimitri Fishler, Strategy and Operations Lead at the Lemonade Foundation, emphasised the use of digital technologies to facilitate payouts to farmers.

“The future of climate protection in agriculture lies in scalable, digital-first solutions. By leveraging digital infrastructure and integrating with mobile wallets, we ensure that farmers are paid, transparently and rapidly, when it matters most,” Fishler said.

Pilot programmes

The 2025 rollout builds on earlier pilot programmes that successfully reached thousands of farmers.

It leverages Pula’s proprietary technologies—including the Pula Insurance Engine (PIE) and Mavuno, an AI-powered farmer registration platform—combined with weather, satellite, and ground data to track rainfall patterns, pest infestations, and disease outbreaks. Farmers whose yields fall below a predetermined threshold will receive compensation, either in cash or through agricultural inputs.

“Together, we are transforming how agricultural subsidies work. We deliver dignity, resilience, and predictability to farmers who feed our nation,” Co-founder and CEO of Pula Advisors Thomas Njeru said.

Agriculture contributes 33 per cent to Kenya’s GDP and employs over 70 per cent of the rural population.

However, fewer than five per cent of Kenyan farmers currently have access to formal insurance products.

By embedding risk protection into a critical government service, the programme aims to stabilise rural incomes, unlock financing opportunities and strengthen national food security.

The ministry emphasised that the project highlights its commitment to shielding farmers from the worsening impacts of climate change, while building a sustainable and resilient agricultural sector.

“This collaboration illustrates the power of public-private partnerships to drive food security, de-risk rural investments and enable climate adaptation at scale,” the Ministry said.