Farmers in Malawi Receive Cash in One of the Largest Insurance Payouts in Africa

After drought and pests destroyed crops during the 2020-2021 farming season, nearly 65,000 farming households in Malawi have received cash payouts from an agricultural insurance programme of the United Nations World Food Programme (WFP). This is one of the largest crop index insurance payouts ever on the African continent, amounting to US$2.4 million.

"Most farmers in Malawi rely on rain-fed agriculture but with the surging effects of climate change, livelihoods are cyclically disrupted, and this fuels hunger," said Honorable Lobin C. Lowe, the Minister of Agriculture, present at the launch of the crop insurance payouts. "Scaling up crop insurance can enhance people's capacity to anticipate and withstand shocks and mitigate their effects in the long run."

The Government of Malawi and a coalition of partners are empowering farming communities to manage their climate risks and reduce impacts of climate-related hazards. In the 2020-2021 farming season, farmers insured crops such as maize, sorghum, rice, groundnuts, pigeon peas and cotton to protect their incomes from harvest losses. Farmers accessed these policies through either paying a portion of their premium in cash or participating in building community assets such as wells, vegetable gardens and tree nurseries that help them withstand future weather shocks.

"With the changing climate, farming can be an uncertain business in Malawi, especially for smallholder farmers. The recent drought saw farmers who usually harvest up to 15 bags of 50kg of maize now harvest only one bag," says Paul Turnbull, WFP Malawi Country Director and Representative. "The payouts are a springboard for farmers to continue their efforts in adapting to increased weather-related shocks and fighting food insecurity and poverty."

In recent years, Malawi has experienced a rise in the frequency, intensity and unpredictability of climate shocks, perpetuating a cycle of food and nutrition insecurity. WFP is working with the Government and its partners to mitigate the impacts of the climate crisis for vulnerable and food insecure communities through an integrated risk management approach.

This initiative has been implemented in Malawi since 2015 and is made possible through multi-stakeholder partnerships. WFP coordinates with technical departments from the Government of Malawi at central and district level and with the financial support of several development partners, including the Adaptation Fund, Flanders, Germany, Switzerland, United Kingdom and the United States.

As climate talks are underway at the 26th Conference of the Parties (COP26) in Glasgow, UK, WFP is advocating for better risk management systems and funding for governments to help climate change adaptation efforts.

Read more about WFP's simple solutions to tackle hunger in Malawi here