Johannesburg - The Land Bank Insurance Company (LBIC) has unveiled the first batch of 17 fully accredited black crop insurance brokers in the country.
The company, which is a subsidiary of the Land Bank, said the prospective brokers were identified from the Financial Services Board’s database and were invited to apply.
The company’s executive director, Dini Nondumo, said the brokers were appointed following a three-month training programme to introduce them to crop insurance.
Nondumo said this was to provide the brokers with a solid grounding in the fundamentals of agriculture, insurance and how solutions could be structured to benefit emerging black farmers.
He said the training focused on crop insurance and commercial agri short-term asset insurance solutions after which the successful brokers had been officially accredited to the market and sold crop insurance on behalf of LBIC, through Agriseker, LBIC’s underwriting managers.
“All the provinces were represented in the programme, except the Western Cape. We didn’t receive any interest coming from that province. However, they have shown interest to be part of the second batch, which will commence its training at the end of September,” Nondumo said.
Of the 17 accredited brokers, seven were women.
Nondumo said the bank hoped that the 450 000 emerging and small-scale farmers in the country would utilise the services of the brokers to understand risk management.
“The fact is that many small farmers do not have access to, or knowledge of, risk management products that can carry them through disasters like the current drought,” he added.
“The estimated 40 000 commercial farmers have enjoyed having full access to advanced financial solutions and insurance, which the emerging farmers didn’t have.”
In 2013, Schneider and Roth findings said there had been a steady increase in global agricultural insurance premiums over the past 25 years, with figures increasing tenfold to almost $30 billion (R418bn).
The research said while much of the growth came from developed countries and partners in the formation like Brazil, India and China, South Africa’s total crop insurance market’s annual premium was valued only at about R1.7bn.
South Africa’s small-scale farmers are the most financially vulnerable to the vagaries of weather. The prolonged drought conditions the country is witnessing, the worst in over a century, have seen small farmers only reap more debts.
“There is room to develop black brokers who can reach out to small farmers in parts of the country where established brokers might see little or no market,” Nondumo said.
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