Bundling weather index-based insurance with loans in Senegal: evaluating impact on insurance take-up and farmers’ well being

Publication Details

3ie Funded Evaluation TW13.1026. A link to the completed study will appear here when available.

Mame Mor Anta Syll, Assane Faye, Hamidou Diop, Moustapha Fall, Seydina Ousmane Sene
Institutional affiliations
University of Gaston Berger, COOPEC, CCPA, CNAAS, IPAR
Grant-holding institution
University Gaston Berger
Sub-Saharan Africa (includes East and West Africa)
Agriculture and Rural Development
None specified
Gender analysis
None specified
Gender analysis
Equity Focus
Evaluation design
Propensity Score Matching (PSM)
Ongoing 3ie Funded Studies
3ie Funding Window
Agricultural Insurance Thematic Window


This study will examine a bundled product that combines weather-index insurance with credit in Senegal.


The insurance market is fairly new in Senegal. Weather-index based insurance (WII) was introduced in Senegal in 2012 through the only operating agricultural insurance company, Senegal National Insurance Company (CNAAS). After five years, uptake of insurance remains low. In this context, CNAAS has partnered with farmers’ organisations and micro-finance institutions as aggregators to provide insurance linked to a lead product such as credit or agricultural inputs. There is a debate on the form of bundling to adopt i.e. whether to provide insurance through mandatory or voluntary bundling. This study will examine the demand for mandatory versus voluntary bundling of insurance with credit and the impacts of insurance provided in this manner on farmers’ productivity and living standards.

Research questions

  1. What sales protocol (voluntary or mandatory bundling) is more likely to sustain take-up of insurance and credit and thus help reach the objectives of increased well-being and poverty and vulnerability reduction among small-scale farmers?
  2. How does the bundled product (WII + credit) influence the adoption of higher return investment strategies and affect productivity of Senegalese farmers?
  3. What is the net impact of the bundled product (WII + credit) on farmers’ well-being?


Intervention design

This intervention will provide either mandatory or voluntary insurance bundled with credit to farmers affiliated to two different aggregators. One aggregator will provide voluntary insurance to all member farmers while the other will provide the mandatory insurance.

Theory of change

The formative evaluation showed that WII take up was high (73 per cent) in the evaluation context. Farmers who applied for credit decided to purchase insurance irrespective of bundling. This forms the basis for the assumption that uptake of insurance will be high. Insurance will provide a possibility to reduce collateral requirements and enhance access to credit by using insurance as a partial substitute to collateral. In the longer term, insurance will compensate policy-holders for rainfall-related harvest losses covered by the insurance contract and stimulate agricultural and off-farm investments, resulting in increased productivity and higher levels of resilience, even in the absence of a shock.

Evaluation design

Treatment and control group farmers will be drawn from the respective aggregators and matched on baseline characteristics. Treatment effects will be estimated using a difference-in-difference method combining baseline and endline data.

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