Good news for farmers
20 May, 2018, 8:30 am
GOOD news for copra and rice farmers as they are now covered under insurance for the first time.A bundled micro-insurance plan was launched for Copra Millers Fiji Ltd in Savusavu and Fiji Rice Ltd in Dreketi by Agriculture Minister Inia Seruiratu yesterday.
The project, an initiative of the UN Pacific Financial Inclusion Programme (PFIP), is in collaboration with FijiCare Insurance Ltd.
The project is one of PFIP’s many regional efforts to increase the use of financial instruments, especially insurance to help Pacific Islanders cope with disaster related risks.
This component of PFIP’s work has been funded by the Regional Disaster Resilience in the Pacific Small Island Developing States (RESPAC), a UNDP-Russia Federation funded program.
PFIP deputy program manager Krishnan Narasimhan said they had covered farmers in the sugarcane and dairy sectors since July last year.
“Prior to this product being made available, Fiji lacked appropriate and affordable insurance products for clients in the low-income segment,” he said.
“From our 2015 research on Fiji’s financial service demand side, we know that only 3.8 per cent of farmers in Fiji have had any form of insurance, showcasing their low exposure to insurance products.
“Though the uptake of this new product has been mostly by the farming industry, it is a great product that can be taken up by any industry or sector, or low-income earning group.
“At a premium of $F1 a week or $52 a year, we believe that this is affordable for almost all Fijians.”
According to Mr Narasimhan, insurance was an important financial service that was needed by individuals to cope with risks like catastrophic or tragic events.
He said if faced with risks, smallholder farmers might apply for expensive loans, exhaust their savings or even sell assets.
“These coping mechanisms may also push farmers who do not have any form of savings towards predatory alternative sources of finances that may lead them to a cycle of debt.”