Insurance innovation can play a transformative role in driving economic prosperity across Africa by helping banks manage agricultural risks and expand financing to farmers, Nigerian insurance expert Ola Jacob of Global Parametrics told DNE Africa.
Jacob said insurance mechanisms can enable banks to protect their exposure to weather-related and environmental risks associated with agricultural lending, helping strengthen the continent’s agricultural sector and broader economy.
“Insurance tools can be used to increase economic prosperity in Africa,” Jacob said, noting that risk-transfer solutions can provide greater financial stability for both lenders and borrowers.
He explained that when banks insure agricultural portfolios against adverse conditions, they are better positioned to maintain liquidity during difficult periods for customers. This allows financial institutions to offer support measures such as overdrafts and loan repayment holidays when farmers face climate-related shocks or other disruptions.
According to Jacob, insurance not only safeguards customers but also helps banks manage their own exposure, creating conditions for faster growth and greater lending capacity.
“It can help them protect their own exposure so they can grow quicker,” he said.
Jacob affirmed that expanding access to financial products across the continent is essential for accelerating agricultural development, which remains a cornerstone of many African economies.
“The more financial products you have in Africa, the quicker that agriculture can grow,” he said, adding that stronger agricultural growth would generate benefits across the wider economy.
He noted that agriculture accounts for a significant share of economic activity and livelihoods across Africa, making investment in the sector critical for long-term development.
Highlighting the continent’s potential, Jacob pointed to estimates showing that around 60% of the world’s uncultivated arable land is located in Africa.
“There’s a statistic that says 60% of the uncultivated arable land in the world is in Africa,” he said. “If we can unlock the opportunity in Africa, then there could be massive growth, and it will be through things like insurance.”
Jacob said wider adoption of insurance products could help unlock investment, improve financial resilience, and support sustainable agricultural expansion, positioning the sector as a key driver of economic growth across Africa.
