CRP Dryland Systems - ILRI - 2015 Technical and Financial Report - Final

Abstract

From 2012, the development of a cutting-edge econometric response model by the IBLI team at ILRI enabled expansion into new areas by identifying the relationship between the Normalized Difference Vegetation Index (NDVI) and livestock mortality. In this way, IBLI was designed to protect to pastoralists’ from the risk of drought related forage scarcity. It is a market-mediated product that is sold to pastoralists by private sector insurance companies. Since it’s inception, over 10,000 pastoralists in Kenya have insured livestock worth over $5 million and these pastoralists have received indemnities totaling $120,000. In Ethiopia, over 3,000 pastoralists have insured livestock worth $1.2 million and have received indemnities totaling $30,000. In 2015, IBLI underwent a shift from an asset replacement to an asset protection contract, as the program scaled up to areas without sufficient livestock mortality data to estimate a statistical response function. Furthermore, the Government of Kenya launched the Kenya Livestock Insurance Programme in August/September 2015, which will offer limited livestock insurance contracts to targeted individuals in Northern Kenya with possible subsidies to the general public in later years.