The Federal Government has partnered with Leadway Assurance and PULA Advisors to pay out N396.7m in insurance claims to smallholder farmers, in a move aimed at protecting Nigeria’s food system from worsening climate risks.
The payout, announced at the 2025 Wet Season Insurance Pay-out Ceremony in Abuja, reached farmers across Plateau, Borno, Kaduna, and Taraba states who recorded losses linked to erratic weather and other climate-related disruptions.
Taraba State received the largest share at N154.31m, followed by Borno with N127.19m. Kaduna farmers got N69.73m, while Plateau received N45.47m, reflecting the scale of losses across the states.
The intervention signals a growing shift toward agricultural insurance as a buffer against shocks that often push smallholder farmers into financial distress after poor harvests.
Speaking at the event, Leadway Assurance’s Chief Executive Officer said agriculture remains highly vulnerable to climate conditions, stressing that insurance is critical to sustaining farmers’ livelihoods and ensuring continuity in food production. He noted that data from the payout exercise would guide future strategies, with a focus on expanding access and improving impact through technology and innovation.
The company added that consistent claims payment is key to building trust among farmers, enabling them to recover, reinvest, and maintain production levels despite setbacks.
PULA Advisors described the initiative as proof that large-scale agricultural insurance can work in Nigeria, noting that over 43,000 farmers were captured under the programme. However, gaps in farmer identification and awareness highlighted the need for stronger engagement and better systems.
The firm emphasised that repeated implementation across multiple farming cycles will be necessary to embed insurance as a standard farming practice, reducing long-term dependence on government support.
Rising production costs remain a major concern. With farm inputs increasing by as much as 70 to 90 per cent, many farmers face significant barriers to restarting operations after losses, underscoring the importance of structured financial support.
The latest payout builds on earlier efforts. In 2024, N110m was disbursed to over 1,100 farmers affected by ginger blight, reinforcing confidence in insurance-backed interventions.
Nigeria’s agricultural sector continues to face threats from flooding, drought, and pests, which regularly disrupt food supply and income for millions. Limited access to insurance—driven by low awareness, high costs, and weak distribution channels—has historically left smallholder farmers exposed.
However, expanding collaboration between government and private insurers points to a gradual shift toward risk-sharing systems that can stabilize production, strengthen rural livelihoods, and reduce pressure on food imports.
Source - https://msmeafricaonline.com
