The government has launched a new agricultural insurance programme to protect smallholder farmers from climate risks. The programme will pay farmers if their yields drop due to drought, floods or other natural disasters.

This new move was announced on July 21, 2025 and integrates climate-smart insurance into the government’s National Fertiliser Subsidy Programme, providing a safety net for farmers who use government-subsidised fertiliser.

What is the Climate-Smart Insurance Programme?

The programme is designed to protect small-scale farmers from crop losses due to weather-related disasters, poor rainfall, pest outbreaks or other yield-shrinking risks. When registered farmers have lower-than-expected harvests, they’ll be paid in cash or inputs like fertiliser—based on weather data, satellite imagery and real-time field monitoring.

Who is behind the Programme?

This public-private initiative is implemented by:

  • Ministry of Agriculture and Livestock Development

  • Pula Advisors

  • Bayer Foundation

  • Lemonade Foundation

  • SOMPO Digital Lab

  • Etherisc

These partners bring together tech, funding and data science to deliver a climate-resilient safety net for farmers.

“Agricultural insurance is a step in the right direction, especially now that climate-related risks are not a distant threat to our livelihoods,”
– Samwel Kiarago, MD, National Cereals and Produce Board

Where will the Insurance be Piloted?

The pilot phase will cover 11 counties and target around 250,000 farmers. The counties are:

  • Makueni
  • Machakos
  • Kisii
  • Migori
  • Meru
  • Nyeri
  • Trans-Nzoia
  • Kakamega
  • Kericho
  • Nakuru
  • Uasin Gishu

This initial rollout will give us valuable insights before the programme is rolled out nationally in future planting seasons.

How do Farmers get Covered?

To benefit from the insurance, farmers must be registered under the Kenya Integrated Agriculture Management Information System (KIAMIS).

Once a farmer is registered and receives government-subsidised fertiliser, they’re automatically enrolled into the insurance scheme—no need to apply or fill paperwork.

Each farmer is insured for up to KSh 7,000, equivalent to two bags of subsidised fertiliser.

What triggers Compensation?

Compensation kicks in if the harvest drops below a predetermined threshold. Payouts are calculated using a combination of:* Satellite imagery

  • Weather station data

  • On-the-ground yield tracking

Farmers will get cash or agricultural inputs depending on the extent of loss and region-specific challenges.

Why This Matters for Kenya’s Food Security

Kenya’s agriculture is rain-fed and smallholder farmers are extremely vulnerable to climate change. This insurance scheme is about building resilience, reducing uncertainty and supporting sustainable food systems.

“This is about transforming agricultural subsidies to deliver dignity, resilience and predictability,”
– Thomas Njeru, CEO, Pula Advisors

“It’s a step towards inclusive insurance, no farmer will be left behind,”
– Mildred Nadah Pita, Bayer Foundation

Towards Resilient Farming

The government says this 2025 rollout is a build on years of successful pilots where thousands of farmers have benefited from similar schemes.

It also aligns with Kenya’s vision of climate-smart agriculture, where farmers get not just inputs but risk protection, data tools and financial resilience.