7,000 Kenyan farmers were on Tuesday, May 30, among the beneficiaries to receive reimbursement for their losses in the first-ever agricultural crypto insurance venture in the country.
In a report by Lemonade Crypto Climate Coalition, it was detailed that the farmers received the money in insurance claims processed for the planting season between October 2022 and January 2023.
The payouts were made through the cryptocurrency platform - Blockchain.
While each payout to the small-scale farmers across the country varied, it was estimated that the total payout amounted to millions.
According to the venture, the farmers had been insured against the harsh climatic conditions in the period when the country experienced low rainfall.
"By parametrically measuring the amount of rain or lack thereof, in an insured field of crops, smart contracts will trigger flood or drought claims automatically, paying farmers without them ever needing to file a claim," read the statement in part.
Lemonade Crypto Climate Coalition also explained that the farmers' payouts were also determined through the sampling of the farms.
"If those sampled farms didn’t hit that target, then all 1,000 farms within the broader zone would receive a crop insurance payout instantly.
"No waiting for months or years, and no depending on faulty proxies (like weather data) to determine whether a crop failed or thrived in a given season" read the statement in part.
Following the success of the pilot programme, the venture is seeking to also insure other farmers during the ongoing planting season.
It was explained that the idea behind the program was occasioned by the lack of insurance ventures in the sector - a move that had discouraged a number of Kenyans from the industry.
"Using the blockchain as a platform, a capital pool will be created to provide insurance capacity. Crypto investors will be able to stake capital in the pool, and potentially receive a share of the premium paid by farmers," read the statement in part.
