Small-scale farmers in Tana River County are set to benefit from a flood insurance policy to cushion them against frequent floods.

This is through a partnership between Britam and global reinsurer Swiss Re to unveil an index-based flood insurance solution to cushion small-scale farmers living along the banks of the Tana River.

In partnership with Oxfam in Kenya, the solution has been developed using data modelling and satellite imagery to predetermine flood thresholds and provide coverage at an affordable cost.

Britam Director of Emerging Consumers Saurabh Sharma said the solution uses water level data to determine historical flooding patterns along the Tana River.

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It determines the likelihood of floods using these patterns and analyses them with socio-economic information to assess the impacts of flooding on households.

The insurance scheme will initially be piloted in Tana River County.

Sharma noted that the innovative solution has been designed using long-term data on the rainfall and water levels in the Tana River as parameters to pay claims.

“As these parameters can be monitored remotely, Britam will be able to pay flood related claims swiftly, thereby supporting the local government & other organizations in their flood mitigation efforts.”

Floods have become quite frequent in Kenya due to climate change. The index-based flood insurance solution is precious for those living in areas with a high risk of flooding but may need access to conventional property insurance products.

According to the Kenya Red Cross Society, between 2000 and 2018, floods affected over 3.4 million people in Kenya, causing over 350 deaths and displacing over 300,000 people.

Oxfam Kenya Social Protection Strategist David Abudho stated that events such as floods have become frequent due to climate change.

 “We, therefore, decided to work with Britam to introduce this innovative solution.We hope the stakeholders lend their support, to replicate and scale up this innovative solution, so that the most vulnerable households across the country can be protected against floods,”

Oxfam will provide the initial premium financing.

The index-based flood insurance was also jointly designed by AB Consultants, an independent market driver in the inclusive insurance space, and Risk Shield, an actuarial firm specialising in designing index-based insurance solutions.

Swiss Re will provide reinsurance support to Britam for underwriting the insurance solution.