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In a new report by Aon, the organisation has announced a collaboration with the African Development Bank (AfDB) and Amini to enhance crop insurance capacity across Africa to bolster resilience among smallholder farmers while promoting the adoption of climate-friendly practices. In addition, the partnership will advance the reduction of supply chain risks within the food and beverage sector and foster new opportunities to expand global agricultural value chains.
Furthermore, the collaboration intends to harness farm-level data generated by Amini to empower Aon’s efforts to assist the AfDB’s Africa Climate Risk Insurance Facility for Adaptation. The goal is to create effective strategies for reducing risk and enhancing the capability to evaluate the evolving threats throughout Africa and ensure farmers can utilise this data to enhance their decisions, resulting in increased resilience and improved yields.
“Aon is at the forefront of transformational innovation, supporting our clients as they face increasing, interconnected climate risks. Risk capital is a vital component of the climate transition, and insurance stakeholders need to innovate faster to address the world’s rapidly changing needs. Our collaboration with the African Development Bank and Amini is a perfect example of a more holistic approach to risk,” stated Eric Andersen, the President of Aon.
According to the African Development Bank, Africa possesses 65% of the world’s untapped arable land, yet the Organisation for Economic Co-operation and Development (OECD) reports that Africa contributes only 3% to the global GDP. However, the need for more environmental data has hindered the expansion of agricultural crop insurance, stunting the growth potential of the agrifood sector and impeding climate adaptation through regenerative farming methods. For instance, African smallholder farmers face high vulnerability to extreme weather conditions, with only 3% having access to adequate crop insurance. Regenerative agricultural practices have proven to be a viable solution, gradually enhancing resilience to floods and droughts while improving crop health and yields, increasing carbon sequestration and reducing supply chain volatility.
“The Africa Climate Risk Insurance Facility for Adaptation is a model of how strategic collaborations can significantly advance our efforts in climate risk management and agricultural sustainability. Aon’s global experience in risk management combined with Amini’s technological innovation form a strong alliance that supports the Bank’s vision for a resilient agricultural sector capable of withstanding and thriving amidst the challenges posed by climate change,” commented Beth Dunford, the Vice-President of the African Development Bank.
“Our collaboration with Aon will help strengthen and accelerate our platform deployment with world-leading companies driven to improve their sustainability practices while reinforcing the resilience of their extensive supply chains,” said Kate Kallot, founder and CEO of Amini. “Together, we have a unique opportunity to kickstart positive feedback loops which will transform global food systems and support the regeneration of natural capital at scale.”