PIA Urges Farmers and SMEs to Embrace Insurance for Risk Mitigation

The Pensions and Insurance Authority (PIA) has called upon farmers and Small and Medium-sized Enterprises (SMEs) to consider insurance as a crucial risk management tool to safeguard against various challenges, including climate change, fire, and theft.

During the 95th Agricultural and Commercial Show in Lusaka, which coincided with Farmers’ Day celebrations, the Authority stressed that insurance plays a pivotal role in fostering growth, building financial resilience, and sustaining businesses.

The PIA highlighted the need to extend insurance coverage beyond commercial businesses, emphasizing that risks are prevalent across all sectors. Small-scale farmers, in particular, are vulnerable to weather-related shocks like droughts and floods. By adopting insurance, they can effectively protect their crops and animals against losses and create a secure environment for investment in the agriculture sector.

“Agriculture insurance aims to enhance farmers’ and producers’ resilience against agricultural production and market risks, especially those arising from climate change and infrastructure challenges. Additionally, it facilitates farmers’ access to financing, as most financial institutions require insurance coverage for those seeking funds,” stated the Authority.

To promote inclusive insurance tailored to small-scale farmers, the Authority and other stakeholders, including the Government, are working towards providing efficient risk management tools for farmers.

Moreover, the PIA encouraged SMEs to embrace insurance as a means to protect themselves from risks like fire, theft, and flooding. Having insurance coverage allows businesses to continue operations with minimal interruption, as payouts can assist in overcoming potential setbacks.

Currently, eight insurance companies offer microinsurance products, and the PIA aims to increase the number of companies providing inclusive insurance products, especially with the introduction of microinsurance in the new Insurance.

The Authority is set to issue licenses to microinsurance companies, focusing on offering insurance products targeting low-income earners, ultimately increasing insurance uptake in the informal sector.

Regarding this year’s theme of the Zambia Agricultural and Commercial Show, “Inclusive Economic Transformation,” the PIA underscored the importance of creating an economy that fosters equitable growth and prosperity for all citizens. Financial inclusion, a key strategic pillar in the Authority’s current plan, aims to promote the development of inclusive pensions and insurance products.

Furthermore, the PIA emphasized the critical role played by pension schemes and insurance companies in achieving an all-inclusive economy. These products act as safety nets for individuals and families during economic hardships, such as retirement, disability, accidents, or natural disasters. By helping vulnerable populations like small-scale farmers manage risks and prevent falling into poverty, these products play a vital role in promoting financial resilience.

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