Harare, (New Ziana) -State-owned financial institution Agricultural Finance Corporation (AFC) has unveiled a comprehensive suite of crop insurance products aimed at protecting both commercial and small-scale farmers from a wide range of risks including drought, floods, fire, and other natural disasters.
AFC chief executive officer Cuthbert Masukume announced the new insurance packages in an interview with New Ziana, saying the products were designed to safeguard farmers’ livelihoods and ensure stability in the agricultural sector in the face of worsening climate volatility.
“Our offerings are divided into three main types namely traditional crop insurance, parametric weather index cover, and area yield index insurance. This multi-pronged approach ensures compensation for both catastrophic events and gradual climate-related losses,” he said.
Under the traditional crop insurance package, farmers are protected against direct perils such as fire, lightning, and damage caused by wild animals, with the core objective of restoring a farmer to their pre-loss financial position following a disaster.
The innovative parametric product known as weather index insurance policy automatically triggers pay-outs based on independently verified weather data such as rainfall measurements, without the need for on-farm assessments. It primarily covers losses arising from drought or excessive rainfall, offering farmers quicker compensation compared to traditional claims processes.
A third product, the area yield index insurance, focuses on the final crop outcome within a specific region.
“This policy compensates farmers if the average yield in their area falls short of the historical average. For instance, if a small-scale farmer expecting one tonne per hectare only harvests half a tonne due to poor weather, they will be compensated for that shortfall,” Masukume explained.
He emphasized that AFC’s pricing structure was designed for long-term stability, with premiums remaining relatively consistent across seasons.
Masukume noted that insurance rates would not be arbitrarily increased based on seasonal forecasts, since most covered perils such as hail, disease, or fire are not entirely dependent on rainfall patterns.
“These insurance products are available for virtually all crops, from staple grains like maize, sorghum, and millet to high-value cash crops such as tobacco and groundnuts,” he said.
The launch of the insurance suite follows the recent regulatory approval for AFC Holdings to raise additional funding from the market through agro-bills, a move aimed at bolstering support for the 2025 summer cropping season.
Since its transformation and official rebranding by President Emmerson Mnangagwa in April, AFC has reorganized into four subsidiaries namely AFC Commercial Bank, AFC Insurance, AFC Land and Development Bank, and AFC Leasing Company.
The new structure is expected to enhance access to credit, insurance, and risk-transfer solutions across all farming sectors including communal, resettled, smallholder, and commercial farmers.
Masukume said the latest insurance initiative reflects broader mission of AFC to strengthen agricultural resilience and ensure food security amid growing environmental uncertainty.
“This is about giving farmers the confidence to invest and produce, knowing that they have a safety net when nature turns against them,” he said.
New Ziana
