Impact study confirms the solidity of the Kenya Livestock Insurance Programme

The Kenya Livestock Insurance Programme (KLIP) is a pioneering effort launched in 2015 by the Kenyan Government to help herders keep their animals alive during extreme drought. On 17-20 April 2018, key stakeholders supported by the Strategic Alliance on Climate Risk Transfer Solutions (STA) of GIZ and Swiss Re organised a workshop with public officials in Mombasa, Kenya, to take stock of KLIP's progress and lessons learned. Informing the assessment was an impact study commissioned by the STA and conducted by the University of Mannheim. The study shows that KLIP is fulfilling its intended purpose and identifies areas for improvement. Based on its success, the Kenyan government plans to extend both the reach and the scope of the programme over the next two years.

Pastoral communities in northern Kenya keep livestock as their main economic activity. Every 3-5 years, however, huge numbers of cows, goats, sheep and camels die of starvation and lack of water because of severe drought. In the period between 2008 and 2011 this cost the country's economy more than USD 12 billion overall, with 70% of that amount attributed to livestock losses. Thousands of pastoralists lost their livelihoods, which in turn increased their dependence on government and donor relief programmes.

In response to their plight, the Kenyan government launched the Kenya Livestock Insurance Programme (KLIP) in 2015 and has since continued to invest, thereby helping the pastoralists to cope better with the effects of drought on their livestock. KLIP's success builds on the work and lessons learned from a pilot conducted in Marsabit and Wajir counties under the Index Based Livestock Insurance Program - IBLI. After a successful start KLIP was then extended to cover six more counties and a total of 18 000 pastoralists representing over 80 000 beneficiaries. The 2016/17 drought was the worst in Kenya in 16 years and KLIP paid out USD 5.3m to 14 000 pastoralists.

During the Mombasa workshop, Agriculture Cabinet Secretary Mwangi Kiunjuri noted that livestock insurance has stabilised the pastoral livelihood system, reduced dependency on relief aid and post-disaster responses, while restoring dignity of the mainstream pastoralists. County governments, donors as well as other stakeholders have been requested to complement the national government’s efforts in cushioning Kenyans from extreme shocks resulting from drought. The Principal Secretary, State Department of Livestock, Mr Harry Kimutai, revealed that the government plans to roll it out to all fourteen of Kenya's arid and semi-arid counties in the next two years in support of the livestock development agenda under the Big Four Plan.

As with every pioneering programme, there are also areas for improvement. The study identifies the need to strengthen the logistical process and platforms enabling speed and ease of claims payments as well as knowledge about insurance in general and KLIP in particular among the target population.

Isaac Magina, Client Manager EMEA Global Partnerships, is pleased by the positive outcome of the impact study. "It was important for us to conduct this study with GIZ through the University of Mannheim to get proper insight into what is working well in the context of the efficiency of the claims process, the beneficiaries understanding of insurance and their propensity for adopting individual insurance policies down the line and what needs to be improved for the continued success of KLIP."