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Exploring Business Models to Sell and Market IBLI


Project Description

An ongoing challenge for our Index-Based Livestock Insurance (IBLI) product is establishing a sustainable client base. This project is a study to find the best business model to sell and market IBLI, ensuring its future as a commercially viable and sustainable product that benefits millions of pastoralists in Africa.

Research Overview


Since IBLI was launched in 2010, the sales and distribution of the product have been largely managed by the commercial insurance agency Takaful Insurance of Africa. As a part of their business model, Takaful Insurance has hired agents to market and sell IBLI in the arid and semi-arid (ASAL) region of Northern Kenya. The current agency model to sell and market IBLI is a three-tiered system:

  • Coordinators, who are responsible for managing the Lead Agents;

  • Lead Agents, who recruit business establishments through their own networks; and

  • Business establishments, who act as insurance agents to sell and market IBLI to their customers.


This business model has proven effective to date in selling and marketing IBLI within the ASAL region, but it is not sustainable in the long term due to high transaction costs and limitations for scaling to other regions. In response, the IBLI team is conducting a study to explore the strengths and weaknesses of the current marketing system in order to generate ideas for a future, more economically scalable and efficient service delivery  model.

Research Activities


The study tests whether having standardized recruitment criteria for agents with measurable indicators will allow the commercial insurance agencies to better assess the capacities of the agents and give them the necessary support to ensure effective sales whilst maintaining relatively low transaction costs. We believe that having a firm structure will also enable the commercial insurance agencies to respond to demands for allied services in the drylands. In addition, the research will provide examples of models of sustainable agency structures for other financial institutions or insurance companies who are currently operating in the drylands or would wish to enter into these markets.

As of June 2019, we have completed two rounds of fieldwork in Isiolo and Wajir Counties, where we interviewed about 40 respondents. Our respondents consisted of all coordinators from the project sites, Lead Agents, sub-agents, and representatives of service-providing groups and associations.

Findings to Date

Preliminary results show there is an ad hoc system of business-level recruitment based on unstructured guidelines provided by the lead agents. In most cases, it was found that the owner of the insurance-selling business is not necessarily the operator of the business. When the operator is not trained about IBLI (i.e., the business owner attends the IBLI training instead of the day-to-day business operator), the operator is likely providing misinformation and inappropriately selling the IBLI product. Moreover, the surveys have revealed a lack of incentives for the agents, which could be demotivating for the agents to continue to keep selling IBLI.

Implementing Partners

  • Kenya Markets Trust 

  • Takaful Insurance of Africa

Funded by

Kenya Markets Trust

Project Timeline

October 2016 - Current


Rupsha Banerjee

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