Some dairy farmers have started getting compensated for their lost cows under the auspices of the agriculture and livestock insurance scheme that was launched in April this year.

Actors in agriculture and livestock sector contend that this plan to protect farmers from incurring future losses is one of the milestones that the sector has ever had.

It is a joint initiative by insurance companies in partnership with the Ministry of Agriculture and Animal Resources (MINAGRI).

But, how does it work, who qualifies for such insurance, and what are criteria considered for one to be paid damages?

Sunday Times’ Emmanuel Ntirenganya reveals how the scheme works.

Earmark microchip technology

The microchip inserted in the ear of the cow as an earmark lets an insurance firm know whether the cow is alive or has died.

It has a reader which electronically registers the identity of the cow in the digital insurance system. This includes information such as the registration number of the cow, its value, location, and owner, according to Joseph Habineza, the Chief Executive officer of Radiant, one of the insurance companies.

"If we use a normal earmark, there is a possibility of a farmer removing the ear from a cow that has died and put it on another cow to lie that another cow, for which they did not buy insurance for, has died,” Habineza told Sunday Times.

"It [the microchip earmark] has GPS-like properties such that it helps track the location of a cow, and they [veterinarians] are able to follow it up. In case of death, it [the microchip] ceases to send signals indicating that the cow is still alive,” Habineza said.

Then, he added that, a veterinarian examines the cause of death.

Age

The cow should be dairy, and not more than eight-year-old, Habineza said, indicating that after that age, it is too old to produce milk.

"It should be a productive cow that is still generating money to the farmer,” he said.

Value for money

Insurance companies partner with the Ministry of Agriculture and Animal Resources (MINAGRI) to calculate the value of the cow.

The veterinarian assesses the cow’s species, size, milk production potential, and age among other factors, which are based on to determine its worth.

Cause of death

The damages covered by the insurance company are those resulting from accidents – such as thunder strike, snake bite or being knocked down by a car –, as well as diseases.

However, insurers warn that the recklessness of the farmer such as not getting the cow treated when ill, or killing his/ her own cow intentionally for meat or other benefits can result in rejection of their compensation claim.

"When it is established that it is not the carelessness of the cow owner, we pay him/her due compensation that we agreed with him/her,” Habineza said.

Government subsidy

Under this joint initiative between the government and private sector (insurance companies), the insurance premiums paid are equivalent to 4.5 per cent of the total value of the insured livestock per year.

A farmer pays 60 per cent of the insurance premium, while the government, through subsidies, supports him/her by covering the remaining 40 per cent.

A farmer gets the total amount of money that their livestock animal is worth in case they lose it to a disaster or disease.

Isaack Ntakirutimana, a farmer from Rwabicuma Sector in Nyanza District, Southern Province, insured his 16 cows.

Last month, one of them died, though it was treated, from a disease that left its liver with a multitude of small holes. The cow, he said, was worth Rwf300,000. He had paid Rwf8,100 premium to insure it.

"The insurance compensated me with Rwf300,000 for that cow,” he said.

Timely compensation

After a farmer has submitted a damage claim for his insured cow, it is investigated and the farmer gets compensation in between 7 and 15 days once the claim has been approved, according to information from MINAGRI.

"This scheme is critical because it reassures farmers that they will not lose all their livestock in case of a disease or accident. It rekindles hope for farmers, and ensures the profitability of their farming activities,” Ntakirutimana said.

As of now, 960 cows have been insured countrywide, according to figures from MINAGRI. In the current financial year, agriculture and livestock insurance project has been allocated Rwf370 million with a target to insure maize plantations on 7,968 hectares and rice on 937.5 hectares, as well as more than 21,400 cows.

editor@newtimesrwanda.com