An Analysis of the Agricultural Insurance Market Development in Ghana

In Ghana, as in most developing countries, agriculture is dominated by smallholder subsistence farming. About 90% of farm holdings in Ghana are less than 2 hectares in size, contributing 80% of total agricultural output in the country (MoFA 2017a). While these smallholder farmers have learnt over the years to cope with various risks through diversification of their income sources, their limited livelihood safety nets do not make them immune to the impact of unexpected financial losses resulting from natural disasters such as floods, pests and drought. In the event of such disasters, most households respond in ways that significantly affect their future livelihoods such as selling off valuable assets, or removing their children from school and hiring them out to others for work (The Katie School of Insurance, 2011). While agricultural insurance could provide greater economic stability for agricultural production and farmers in Ghana (Roth and McCord, 2008), very few of such products are offered in the Ghanaian market.

Specifically, this study is expected to review the agricultural insurance market development in Ghana with a primary focus on:
–– Updating the 2017 study with current facts and figures
–– Analysing new and emerging actors (i.e. updating the stakeholder analysis),
–– Reviewing changes in the regulatory environment,
–– Analysing the Ghana Incentive-based Risk Sharing System for Agricultural Lending (GIRSAL) and any similar national schemes, and
–– Outlining key recommendations and lesson learnt.