Scaling up crop insurance in Africa for climate resilience and agricultural transformation
Crop insurance can help smallholder farmers in Africa and elsewhere manage climate risk and stabilize livelihoods in the face of droughts and extreme weather. · Although insurance has evolved to become more affordable, further innovation is needed to ensure high-quality products that cover farmers’ needs. · Scaling coverage requires better product design, farmer education, and links to credit and inputs and in some cases smart subsidies.
- food systems
- insurance
- Climate Resilience
By Ruth Hill and Berber KramerMarch 10, 2026
Key takeaways
· Crop insurance can help smallholder farmers in Africa and elsewhere manage climate risk and stabilize livelihoods in the face of droughts and extreme weather.
· Although insurance has evolved to become more affordable, further innovation is needed to ensure high-quality products that cover farmers’ needs.
· Scaling coverage requires better product design, farmer education, and links to credit and inputs and in some cases smart subsidies.
As climate change impacts intensify, African economies face increasing exposure to extreme weather events. The World Bank estimates that nearly 18% of the world’s population is at risk from severe weather events from which recovery would be difficult; in Africa, that number is 37%. Agriculture, which hundreds of millions of Africans depend on for their livelihoods, is especially vulnerable. African smallholders often lack sufficient safety nets, while farming is heavily reliant on rainfall, making the sector disproportionately vulnerable to climate shocks.
Crop insurance and other types of risk transfer instruments are promising tools for farmers in low- and middle-income countries to secure their investments and manage income fluctuations. These tools help in protecting household welfare by providing financial lifelines to farmers during crises, and more generally by unlocking financing and farmer investment in high-return activities such as investing in fertilizer, increasing area produced, and increasing production of cash crops.