The R4 Rural Resilience Initiative (previously the Horn of Africa Risk Transfer for Adaptation (HARITA) project) is a joint programme led by Swiss Re and Oxfam. Farmers are given the option to work on projects designed to reduce agricultural risk, such as improving the soil and reducing water run-off, in order to purchase weather-based index insurance. It gives farmers the option to pay for their premiums with labour, engaging them in community-led and locally designed climate adaptation initiatives such as reforestation and crop irrigation projects in return for insurance. This programme has reached 29% of Tigray’s population.
“R4” refers to 4 strategies for managing risk: risk reduction, risk reserves, risk transfer, and prudent risk taking. Building ‘risk reserves’ means that farmers build a financial base, either individually or as a group, which can provide a buffer for short-term needs in a response to shocks, aiding a farmer’s ability to cope with risk. Prudent risk taking allows the savings to be used as microcredit, allowing farmers to create an asset base.
The programme has since been scaled-up from 200 Ethiopian farmers in the original 2009 HARITA pilot in Tigray, to more than 24,000 farmers across 81 villages by 2014. From 2009-2012, insured farmers increased their savings by an average of 123% more than their uninsured counterparts. In some districts farmers with insurance were able to increase their number of oxen, while others enjoyed increased reserves of grain. For example, in Kola Tembien, farmers who bought insurance in both 2010 and 2012 increased their grain reserves by 254% compared to those who never bought insurance. Farmers who bought insurance also displayed a greater ability to diversify their income sources.
An additional 2,000 farmers in Senegal also benefitted from the R4 initiative in 2014, following the 2013 Senegalese launch of the scheme. Farmers report that they see insurance as a form of saving which helps them survive the inevitable droughts. One farmer said “it saves your money in time of good harvest and compensates you when the rains are not good. On the other hand, you benefit from increased yields as a result of the inputs and knowledge when the harvest is good.”