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Oromia Insurance Company S.C (OIC) Paid Birr 5.23 Million Claim to Borana and West Guji Zones Pastoralists in Index Based Livestock Insurance (IBLI).

Oromia insurance Company settled it’s largest claim to insured pastoralists of Borana and West Guji Zones on the colorful ceremony organized by the company and stakeholders on September 5, 2017 at Moyale Town. Many partners from NGOs, research institutions, government representatives and different Medias took part on the event. During this occasion, OIC paid Birr 5.23 million to 2,195 insured pastoralists of ten districts in the two zones. 



The maximum payout was Birr 218,800.00 per person, while the minimum was Birr 200, i.e those who purchased insurance for only one shoat. Mr. Konso Duba is a pastoralist living in Shawabare kebele of Moyale district. He received Birr 218,800.00 payout on this occasion, which was the largest. What he spent to buy the insurance as a premium was Birr 30,000 for the annual contract which is approximately 6.5% for the Long Rain Long Dry (LRLD) contract period. According to Mr. Konso, he sold only three cows to purchase the insurance which was simple to him. He was very much happy for receiving his payout and for being pioneer of this contract window. Finally, he promised to be the ambassador of OIC and promote IBLI within his kebele and beyond.

In the same manner, OIC had also paid more than 1.6 million Birr to 1,474 household (HHs) insured pastoralists of the same zones and districts on 18th February 2017.

This witnesses that OIC is committed to serving the low income peoples of rural farming and pastoral communities and is discharging its corporate social responsibilities in this regard.

There was severe drought during both the SRSD and LRLD seasons in the two zones during the ended fiscal year 2016/17 where many heads of livestock died. According to the information gained from Oromia Pastoral Area Development Commission, 200,000 heads of livestock have been lost due to drought in Borana zone alone. It is not difficult to imagine that the IBLI could have protected the loss of these livestock that was happened as a result of drought, had the owners bought insurance ahead, as the contract is purposed for asset protection.


Index Based Livestock Insurance (IBLI) is an asset protection contract that was designed to compensate pastoralits even before the animals die. This helps the pastoralists keep their livestock alive by purchasing supplementary feeds by the compensation money they get. It is an annual contract covering two seasons. The first season is Short Rain Short Dry (SRSD) which covers the period from October to February (Five months) and the other is Long Rain Long Dry (LRLD) that covers a period from March to September (seven months). 

OIC is doing its very best to bring the case to the attention of the government both at regional and national level and to establish Public-Private-Partnership (PPP) so as to scale up the index based livestock insurance programme. Discussion has been made in this regard with both the regional government and local administration offices and they are keen on supporting the programme.

During the payout ceremony that was held on September 5, 2017 at Moyale town, the Oromia Pastoral Area Development Commission Commissioner, Mr. Ibrahim Haji  and the Deputy Head of the Borana Zone Pastoral Development Office, Dr. Guyo Qancora took part on the event and assured that they are ready to extend any support required of them in this regard as the IBLI is really helping pastoralists cope up the drought risks they have been facing year after year and as it reduces burden from the government too.