Senegal : a parametric insurance product for the cotton sector created by FINACTU, CNASS and BOAD
In Senegal, FINACTU assists the National Agricultural Insurance Company of Senegal (CNAAS) in the creation and launching of a parametric insurance product for the cotton sector at the national level against climate risks, with the support of the West African Development Bank(BOAD).In the summer of 2017, all cotton producers in Senegal subscribed to the first national index-based insurance policy. FINACTU is very proud to have participated in this success within the framework of the mandate of technical assistance to the West African Development Bank which it taken on since 2014.
With nearly 40,000 insured producers, it is one of the largest index-based insurance projects in sub-Saharan Africa protecting against climate hazards. As Denis CHEMILLIER-GENDREAU, President of FINACTU, points out, "This success is based on the conviction, consistently developed by FINACTU for years, that agricultural insurance can only develop through the use of aggregators. who distribute them ". In this case, the distribution of this product has been integrated into the agricultural input financing circuit, in the same way as fertilizers, with the valuable assistance of the National Federation of Cotton Producers (CNPC), the Textile Fiber Development Company (SODEFITEX), and financial support from the Caisse Nationale du Crédit Agricole du Senegal (CNCAS).
This great success that CNAAS and its partners have just achieved must become a reference in the sub-region for several reasons:
In the first place, because it is one of the first "group" policies in West Africa, covering the entire agricultural sector, far from the "pilot projects" to which agricultural insurance was confined for too long;
Next, this policy confirms the key role played by the aggregators, who know farmers better than anyone and have an unparalleled position to ensure the distribution of insurance;
Finally, the product is based on satellite indices of evapotranspiration, a powerful index that ensures a good level of correlation with the historical yields observed by producers. The extreme technical sophistication of the product combines wonderfully with the extreme simplicity of its marketing presentation to farmers.
The product is insured by CNAAS and reinsured by a leading reinsurance consortium of AXA, AFRICA RE, and CICA RE. Read more on Ecofin Agency. Source: Ecofin Agency