Project update, October 2012
- HARITA, a project by Oxfam America and REST, has broken new ground to integrate disaster
risk reduction and affordable insurance by allowing poor farmers to pay insurance premiums with their labor
through risk reduction projects in their communities. Scaling from 200 households in one village in 2009
enrolled in the financial package to more than 13,000 enrolled households in 43 villages in 2011, by end of
2012 HARITA aims to have reached approximately 70 villages and 15,000 households.
- One of the key achievements in 2012 is that farmers are now purchasing insurance either with partial or
full cash instead of purchasing it entirely with labor, reflecting progress towards the establishment of
commercial insurance market in rural Ethiopia.
- Building on the success of HARITA, the activity is currently being expanded within Ethiopia and in Senegal
as part of the R4 Rural Resilience Initiative, led jointly by Oxfam America and WFP. Expansion to two
additional countries is also planned over the next five years.
- For more detailed project update, read the latest quarterly progress report here.
Location: Africa, Ethiopia, Tigray
Date project established: 7/1/2008
For the 1.3 billion people living on less than a dollar a day who depend on agriculture for their
livelihoods, vulnerability to weather-related shocks is a constant threat to security and well-being. As
climate change drives an increase in the frequency and intensity of natural hazards, the challenges faced by
food-insecure communities struggling to improve their lives and livelihoods will also increase. The question
of how to build rural resilience for climate change adaptation is critical for addressing global poverty.
In response to these challenges, Oxfam America, Swiss Re and their partners developed a holistic risk
management framework to enable poor farmers in the drought-prone northern state of Tigray in Ethiopia to
strengthen their food and income security through a combination of community climate resilience projects
(risk reduction), insurance (risk transfer), microcredit ("prudent" risk taking), and savings (risk
reserves): the Horn of Africa Risk Transfer for Adaptation (HARITA) project.
HARITA brought together a network of partners including Ethiopian farmers, the Relief Society of Tigray
(REST), Nyala Insurance Share Company, Africa Insurance Company, Dedebit Credit and Savings Institution
(DECSI), Mekelle University, the Tigray Regional Food Security Coordination Office and the Tigray Cooperative
Promotion Office, the International Research Institute for Climate and Society (IRI), Swiss Re and Oxfam
America. The project is funded by the Rockefeller Foundation and Swiss Re.
Existing approaches to providing drought insurance to the poorest have not been effective due to high
administrative costs and the inability of cash-poor smallholders to afford premiums. In conversations with
farmers, they themselves suggested a solution – they could pay for insurance with their labor. Oxfam
America worked with the Relief Society of Tigray, the Tigray Regional Food Security Coordination Office and
the Tigray Cooperative Promotion Office – to build an “insurance-for-work” program on top
of the government’s “food- and cash-for-work” Productive Safety Net Program (PSNP), a
well-established program that serves eight million chronically food-insecure households in Ethiopia.
The Ethiopian National Meteorological Agency also played a strong role in supporting weather data collection
and analysis for the weather index insurance.
The resulting innovation allows cash-poor farmers the option to work for their insurance premiums by engaging
in community-identified projects to reduce risk and build climate resilience, such as improved irrigation or
soil management. In the event of a seasonal drought, insurance payouts are triggered automatically when
rainfall drops below a pre-determined threshold, enabling farmers to afford the seeds and inputs necessary to
plant in the following season and protecting them from having to sell off productive assets to survive.
In partnership with local microfinance institutions, the model allows farmers the option to bundle insurance
with credit and savings.
More prosperous farmers will pay their insurance premiums in cash. Over time, as the poorest farmers become
more prosperous, they can "graduate" from the need to pay through labor, and begin paying in cash,
helping to ensure the project's commercial viability and long-term success.
Mitigation and/or Adaptation
HARITA is an integrated approach to risk management. The financial package is a tool for individual
farmers to adapt to climate change (discussed in this section), and the risk reduction projects provide
social benefits to the broader community (discussed in the following section). Taken together, these services
protect farmers from the consequences of climate-related disasters.
The benefit of the project is illustrated by a statement from Gebru Kahsay, a 52-year-old farmer in Tigray
who depends on rain to grow teff, a staple grain. "According to my belief, this insurance is important
to protect us from migrating in a drought in search of food," says Kahsay.
Oxfam America funds and oversees an impact monitoring, evaluation and learning (IMEL) plan to assess the
impacts of HARITA and to improve its delivery as it expands. We use a rigorous mixed methods approach
that combines quantitative surveys and qualitative focus groups and interviews. In 2011, the IMEL team
will continue an ongoing evaluation of 400 households in eight villages in Tigray, Ethiopia, with five
program villages and three control villages.
The evaluation explores how effective the HARITA approach is in improving resilience to risk under different
conditions. With regard to the financial package as a tool for climate change adaptation, the
evaluation addresses such questions as:
- What are the impacts of index insurance on farmers’ risk management and production decisions and
livelihoods, including decisions related to credit and savings?
- Who benefits, who does not benefit, and under what conditions do benefits occur or not occur, and
Although it is too early in the project cycle to make a definitive assessment of the overall effectiveness of
the model, the results of prior seasons are promising.
The labor used to pay for weather index insurance is contributed towards community-identified projects to
reduce risk and build climate resilience, such as improved irrigation or soil management. Farmers identify
these activities through community-driven participatory capacity and vulnerability assessments.
In 2010, eligible farmers contributed their labor towards the following risk reduction projects in five
villages: five runoff diversion structures for spate irrigation were constructed, with over 8,000 meters of
diverting canal and 265 hectares of land irrigated; 15,000 trees were planted; 2,000 meters of
erosion-preventing trenches were constructed; 600 compost-making pits were prepared, and 700 farmers and over
40 local leaders and extension agents were trained on composting practices.
The impact monitoring, evaluation and learning (IMEL) plan discussed above also pertains to measurement of
social benefits. With regard to community risk reduction activities, the evaluation addresses such
- Which risk reduction activities were implemented? When and where?
- How do the implemented risk reduction activities relate to the particular needs of participating farmers
and their villages?
Potential for Scaling-up and replication of project
HARITA represents a dynamic public-private partnership in action, with groundbreaking innovations in
integrated risk management and service delivery. In its three years of delivery in Ethiopia, HARITA has shown
promising results for replication. The project has scaled from two hundred households in one village in
2009 enrolled in the financial package, to over 13,000 enrolled households in 43 villages in 2011 –
directly affecting approximately 75,000 people.
Early results demonstrate that the HARITA model can effectively reach vulnerable families, who had once been
viewed as uninsurable. In the 2010 season, 39 percent of the households that purchased the insurance were
female-headed and 83 percent were participants of the Productive Safety Net Program (PSNP). With such rapid
growth, HARITA holds the potential for much larger scale within Ethiopia and in other countries.
HARITA’s success led, in 2010, to an agreement by Oxfam America and the World Food Programme (WFP) to
take the HARITA model to a multi-national scale by launching, as equal partners, a joint project, the Rural
Resilience Initiative (or “R4,” for Risk Reduction – Prudent Risk Taking – Risk
Transfer – Risk Reserves). R4 will operate across four countries – Ethiopia, Senegal, and
two more in the developing world – uniting Oxfam America’s HARITA model and WFP’s extensive
network of safety nets and cash-for-work programs, in close coordination with local partners and government
agencies. Under R4, WFP programs will operate as “insurance-for-work” for the poorest of the
participating farmers, leveraging this core HARITA innovation to build a profitable market for small-scale
agricultural insurance at commercial scale. In Ethiopia, Oxfam America will continue to operate in
partnership with the Relief Society of Tigray.
The R4 Rural Resilience Initiative is a strategic collaboration between the World Food Programme and Oxfam
America. Each partner has its own sponsors: WFP is sponsored by USAID, and Oxfam America by Swiss Re and the
From a donor perspective, the R4 model doubles investment value: while a certain dollar amount of aid could
be used in “traditional” development programs either to pay an insurance premium or to pay
farmers to carry out risk reduction measures, in this project, the same amount of money yields insurance and
risk reduction simultaneously.
R4 is a strategic collaboration to build upon HARITA’s success in Ethiopia and replicate the model in
other countries. The mission of R4 is to achieve rural resilience by enabling adaptation to climate risk
through a community oriented, risk management focused, and market-based approach that supports the most
vulnerable people to graduate from food insecurity and escape the poverty trap.
R4 provides a replicable and scalable model for building resilience, using existing government-owned and -led
productive safety nets to reduce disaster risk and as a delivery mechanism to expand insurance and other
financial services to create an enabling environment for pro-poor market growth. By working in diverse
microclimates, R4 allows insurance companies to diversify risk and open up new markets. This will attract
additional insurance and reinsurance companies to the agricultural market in developing countries. In turn,
farmers will benefit from an increasingly broad array of insurance products from which to choose and
competitive pricing that should bring down premium rates over time. Founded on the principles of
collaboration and mutual support by the public and private sectors, farmer-owned agricultural cooperatives,
and intergovernmental organizations, R4 focuses on long-term, sustainable solutions to reduce poverty and
hunger by building rural resiliency.
Relief Society of Tigray (REST);
Nyala Insurance Share Company;
Africa Insurance Company;
Dedebit Credit and Savings Institution (DECSI);
The Tigray Regional Food Security Coordination Office;
The Tigray Cooperative Promotion Office;
The International Research Institute for Climate and Society (IRI)