Partnering with members of group saving and loans organizations (GSLs) may be an effective way of undertaking extension work on index-based livestock insurance (IBLI). However, there is little evidence to suggest that extension through GSLs has increased IBLI uptake above the 6-9% household baseline rate. These are the findings of the latest research brief by the International Livestock Research Institute (ILRI), Integrating index-based livestock insurance with community savings and loan groups in northern Kenya. Despite the availability of huge livestock resources, pastoralist areas of northern Kenya are characterized by chronic vulnerability to drought-related shocks and pastoralists’ declining coping abilities. Innovative strategies are needed to safeguard livestock-based livelihoods and enhance drought-coping mechanisms. One such strategy is to link the acquisition of a livestock-based insurance product with access to informal financial services, smoothing out household consumption and preventing distressed sales of livestock. In collaboration with CARE Kenya in 2013, the IBLI project undertook a study of efforts to integrate livestock insurance with group savings and loan organizations (GSLs) in Marsabit County. Under their Marsabit Drought Resilience Project (MDREP), 71 GSLs were formed across the divisions. Constituted by community members—primarily women—GSLs pool their savings to extend small loans to group members. The main objective of this IBLI/CARE collaboration was to assess the impact of integrating an insurance product for pastoralists’ most productive asset alongside access to informal financial services. The study found substantive differences between the GSLs profiled, including interest rates, collateral requirements, and savings-to-loan ratios. Nevertheless, overall GSL members accumulated more savings and accessed more loans than their non-GSL counterparts. GSL members’ relative success in correctly answering questions on IBLI suggests extension through GSL groups may be more effective than through normal IBLI channels. But full product comprehension is patchy and depends on the quality and motivation of community-based trainers. Increasing understanding of IBLI hinges on improving training of GSL members and developing a package of more accessible educational tools for use in the groups. However, most households are reluctant to borrow to purchase insurance, due to high interest rates on loans, the social and economic sanctions on default, and the risk of the insurance not triggering. One way of increasing IBLI uptake, the brief recommends, would be to further subsidize insurance premiums or loans. Source - ibli.ilri.org