Since 2015, Kenya-based insurtech company Pula has been strengthening access to agricultural insurance for smallholder farmers in emerging markets, protecting them from losses due to pests, diseases, and extreme weather events such as floods and droughts. He is working hard.
So far, the insurtech has helped 15.4 million farmers in Africa, Asia and Latin America gain insurance coverage, and has launched a $20 million series that will allow it to establish new partnerships including livestock insurance. BIt is attracting even more attention after receiving funding.
BlueOrchard, a global investment management company, led the round through its InsuResilience strategy, which aims to provide access to climate insurance to vulnerable populations in emerging markets. IFC participated in the round through its $225 million venture capital platform, the Bill & Melinda Gates Foundation, Hesab Capital, and existing investors.
“Partnering with this like-minded group of investors to drive Pula's growth globally is a very exciting milestone in driving our Triple 100 vision, and through this we will reach 100 million people. What started nine years ago as an unconventional idea that many considered unscalable is now providing insurance to millions of small farmers in 22 countries. It is a proven solution that solves a real need,” said Pula CEO Thomas Nigel, who co-founded the insurtech with Rose Goslinga. .
Pula co-founders Rose Goslinga and Thomas Njeru have backgrounds in agriculture.Image credit: Pula
Pula embeds insurance in our partners' products
Instead of selling insurance directly to farmers, Pura has built a distribution channel of more than 100 partners, including charities, banks, governments and agricultural input companies, and has built a distribution channel of more than 100 partners, including charities, banks, governments and agricultural input companies, to help hard-to-reach farmers by integrating insurance into their policies, for example. They also provide services. Farm input costs or credits.
Each product offered by Pura is customized to customer demand and beneficiary farmers' needs. Underwritten by insurance and reinsurance companies, the product uses Pula's digital actuarial analysis based on historical data such as weather patterns, frequency of events such as floods and droughts, yields, losses and inputs used. Designed (including premium settings) through the platform.
Among the collaborations is a long-term partnership with the Zambian government, where the insurtech embeds insurance premiums into fertilizer and seed packages and delivers them to farmers across the country. In Ethiopia, we partnered with the World Food Program, the German Development Bank KfW, and local insurance companies to integrate insurance into an input voucher system that reaches 122,000 farmers. And its effects are about to be felt after the outbreak of wheat rust in the Amhara region. Pula will pay out the largest insurance payout to date, estimated at $800,000.
Pula said farmers who use their products have increased investment, yields and savings, adding that although smallholder farmers account for 70% of the food supply, only 1% of it is covered. The report highlights the benefits of agricultural insurance for emerging markets such as Africa, where there is a lack of agricultural insurance. . Difficulty in accessing insurance, lack of affordability, and lack of awareness are barriers to accessing insurance.
“Research conducted by Pula in some African countries where we provide insurance shows that agricultural insurance increases smallholder farmers’ investment in their farms by an average of 16% and increases yields by 56%. , helping to increase household savings by up to 170%.''The impact on farmers' livelihoods can also be seen in the payments made by our partner insurance companies, since Pula's establishment to date. Nearly US$40 million to US$900,000 has been paid to farmers,” Nigel said.
“Finally, our impact is reflected in renewal rates and growth. 80% of farmer groups and aggregators who purchase insurance products developed by Pura from our partner insurance companies renew in the following year, which is the highest in the industry. This is above average and reflects customer satisfaction with our comprehensive offering.”
Building on the success of its crop insurance products, Pula plans to introduce livestock insurance in countries such as Kenya following the completion of a pilot program that began in Nigeria last year. Through its insurance partners, Pura provides comprehensive coverage against banditry, disease and animal death to rural households in Nigeria. We are also focusing on the Asian and Latin American markets, which we will enter in 2021.