Professional Assessment of Agricultural Insurance Penetration in North East Nigeria

Agricultural insurance reduces farmer exposure to climate and market risks, and professionally assessing its penetration in the North East zone identifies barriers to expansion that constrain rural resilience and investment in one of Nigeria's most vulnerable regions. This study professionally assessed agricultural insurance penetration in Gombe, Bauchi, and Adamawa States, North East Nigeria. A mixed assessment methodology combined structured interviews with 20 insurance company representatives and NIRSAL officials, a farmer survey of 200 smallholder farmers, and a market penetration analysis using NAICOM insurance sector data. Assessment confirmed that formal agricultural insurance coverage was below 3 percent of eligible farmers across the three states. The Nigerian Agricultural Insurance Corporation's crop insurance products were known to only 17.4 percent of sampled farmers. Premium affordability was the most cited barrier (by 64.2 percent of aware farmers), followed by low trust in claim payment processes (51.3 percent). Claim settlement delays averaged 8.4 months, far exceeding the 30-day benchmark. The study concludes that agricultural insurance penetration in North East Nigeria is critically low due to product design, distribution, and claim settlement failures. Recommendations include redesigning premiums with government subsidy support, partnering with mobile money platforms for premium collection, establishing a NEDC-sponsored agricultural insurance expansion programme, and mandatory NAIC claim settlement time standards with performance penalties.

Keywords: agricultural insurance, North East Nigeria, NAIC, farmer risk management, insurance penetration