Satellites to help Kenyans insure against drought

By Alister Doyle, Environment Correspondent

OSLO (Reuters) - Satellites measuring the greenness of Kenya from space are set to help insure livestock herders against droughts and mitigate the effects of climate change, experts said Friday.

"This is a new approach to tackle an old problem," Carlos Sere, director general of the International Livestock Research Institute (ILRI), said of the satellite-based insurance for cattle, goats and other animals.

"In the volatile climate change world this type of project will be more important," he said during a visit to Oslo. The Kenyan pilot scheme, due to start in early 2010, would be the first such satellite insurance for a developing nation.

Satellite images will measure the greenness of vegetation in the Marsabit area of northern Kenya. A shift to brown will trigger payouts to pastoralists because of expected livestock deaths from drought.

"Traditionally we have helped pastoralists by sending them hay if there is a drought, or treating the weakest animals with vaccines to keep off diseases," Sere said. "That's very inefficient and expensive.

"With traditional insurance you can insure your cow. But then the vet has to come and certify that it's dead. The transaction costs are huge," he said. The satellite system bypasses the need for such verification.

Andrew Mude, an ILRI expert, said talks were being held with Kenyan insurer UAP, reinsurance from Swiss Re and Kenya's Equity Bank on details.

Annual premiums were likely to be $50-100 a year for households with 6-8 cattle, the ILRI said. Aid agencies might prefer to pay premiums rather than help after a drought.