Ethiopia on Wednesday launched a distinctively designed crop insurance based on Normalized Difference Vegetation Index (NDVI) for its small holder farmers.The new insurance policy intends to promote and venture into rural micro insurance products and to provide safety nets for low income section of the population in Ethiopia, stated Yewondwossen Eteffa, CEO of Ethiopian Insurance Corporation during the launching event.
The latest insurance policy aims to insure small holder farmers against weather related risks.
The insurance scheme envisages attracting 200, 000 small holder farmers this year and 15 million over the coming five years.
In Ethiopia, well over 15 million small holder farmers are engaged in subsistence farming which is traditional and rain-fed with very limited areas under irrigation. Natural disaster especially, drought (floods, excessive rain, pests) are the major calamities badly affecting crop production in Ethiopia.
Official documents indicated that the estimated loss due to disaster in the past decade is approximately 2.5 billion birr and the new insurance program targets covering such losses.
The new insurance uses technology platforms and works with cooperatives and micro finance, Eteffa said
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