LocationsGovernment commits UGX 5 billion to Uganda’s Agriculture Insurance Scheme for the year 2025/2026
3 million Farmers to be reached for Agricultural Insurance by 2027
March 29, 2025
A young farmer holding freshly harvested Carrots
UNDP Uganda
For decades, Ugandan farmers have faced increasing climate risks. Unpredictable rainfall patterns, prolonged droughts, and devasting floods which have made farming an increasingly precarious livelihood – even more, there have been threats to market volatility for agricultural products.
In today’s development world, we are now witnessing increased financial uncertainty, with many donors either reducing or withdrawing development funding – this financial uncertainty and climate risks increase the poverty gap and undermine sustainable development.
It is times like these, that require us to institute more integrated approaches to secure the livelihoods of small-scale farmers from climate risks and financial uncertainty. For Uganda’s population, majority depend on agriculture for their livelihood with many farmers mostly practicing subsistence and small-scale agriculture. If we put more efforts towards integrating agricultural insurance approaches to reach the small-scale farmers, we will be reducing the poverty gap and advancing sustainable development.
A New Approach
The United Nations Development Programme (UNDP), through its Financial Resilience in Agriculture (FRA) initiative with support from the Gates Foundation, introduced a structured government collaboration model to scale adoption of Uganda's Insurance Scheme. A dedicated team was formed to introduce the Integrated Agriculture Insurance Agenda, a tool developed by UNDP to institutionalize and expand agriculture insurance. In March 2025, Uganda launched its Integrated Agriculture Insurance Agenda, a comprehensive framework that aligns four strategic pillars: policy, regulation, programs, and financing. This holistic approach moves beyond traditional insurance models to create sustainable solutions for smallholder farmers with a goal to align stakeholders and achieve coverage for 3 million farmers by 2027.
"This isn't just about insurance policies," explains Mr. Ian King, UNDP, Deputy Resident Representative. "It's about creating an ecosystem where government leadership, regulatory frameworks, comprehensive programs, and innovative financing work together to protect farmers' livelihoods."
Government Leadership on Uganda’s Agriculture Insurance
The Government of Uganda has taken a proactive stance, providing strategic leadership by setting a clear vision for agricultural insurance. This involves appointing established institutions to coordinate stakeholders and drive alignment across the four pillars. Most importantly, the government is institutionalizing this agenda by developing processes and structures to ensure the effective implementation of policies, regulations, programs, and financing mechanisms to reach scale, sustainability, and impact.
Participants during a 2-day workshop on institutionalizing and scaling up Uganda Agriculture Insurance Scheme (UAIS)
UNDP Uganda
During a technical workshop on implementation strategies for institutionalizing and scaling up Uganda Agriculture Insurance Scheme (UAIS) held in Kampala recently, the Insurance Regulatory Representative – Mr. Protazio Sande who opened the session on behalf of Ministry of Finance Planning and Economic Development (MoFPED) emphasized the importance of mitigating risks for small scale farmers in Uganda, urging a more coordinated approach among all stake holders.
On his part Mr. Musa Lukwago, from MoFPED, highlighted the Government’s plan to double its annual contribution to Uganda’s Agriculture Insurance scheme, confirming the annual contribution of the 5 billion Uganda Shillings for the financial year 2025/2026 to support its expansion. He also emphasized that there will be no taxes imposed on UAIS to encourage its growth and tax exemptions including VAT and stamp duty to encourage participation.
Held on the 28th of March 2025, the 2-day workshop gathered stakeholders from Government Ministries, UNDP, Agro Consortium, Insurance Sector Stakeholders, Financial sector stakeholders, Representation from the farmers, Development Partners, and players from the digital market with a focus on key objectives below;
To strengthen Uganda's agricultural insurance framework by tripling the subsidy allocation from UGX 5 billion to UGX 15 billion, creating a stronger financial foundation for farmer support. To develop strategies to expand coverage from 1 million to 3 million farmers, significantly widening the protective reach across agricultural communities. To build technical capacity in data management and product innovation to enhance the efficiency and effectiveness of insurance offerings. Finally, to create a joint implementation roadmap for the Uganda Agriculture Insurance Scheme (UAIS), ensuring coordinated efforts among government agencies, insurance providers, and farmer organizations.
Next Steps
Subsidy Strategy: Finalize the proposal to increase funding and explore alternative financing mechanisms to support the scheme.
Policy Reform: Accelerate the adoption of a comprehensive agricultural insurance policy to provide a robust regulatory framework and support the Finalization and enforcement of the National Agriculture Finance and Insurance Policy.
Data and Innovation: Invest in digital infrastructure for real-time claims processing and data-driven product design to improve efficiency that is development of a unified data platform for agriculture insurance development.
Awareness Campaigns: Scale sensitization programs targeting women, youth, and large-scale individual farmers to increase uptake.
Institutional Coordination: Develop a cross-ministerial task force to align mandates and implement the Agricultural Insurance Agenda effectively and onboard Ministry of Agriculture Animal Industry and Fisheries to expand on the distribution of Agriculture Insurance.
Monitoring and Evaluation: Establish key performance indicators (KPIs), monitoring and evaluation tools and regular review mechanisms to monitor progress of the scheme and make necessary adjustments.
By Joel Akena, Communications and Partnerships Associate