Name: Abdimajid Mohamed Hassan Register no: IV/325/19

Teacher: Chris Mutsami

Date: 02.03.2021

1- The challenges facing agricultural or livestock insurance in Somaliland:

a. Systemic risks
b. Adverse selection and moral hazard
c. Emergency Aids
d. Poor agriculture risk infrastructure
e. Low risk awareness
2- Address of the above mentioned challenges:
a) Systemic risks: to help manage systemic risk investors should ensure that their
portfolios include a variety of asset classes such as fixed income, cash and real
estate, each of which will react differently in the event of a major systemic
change.
b) Adverse selection and moral hazard: The way to eliminate the adverse
selection problem in a transaction is to find a way to establish trust between the
parties involved. A way to do this is by bridging the perceived information gap
between the two parties by helping them know as much as possible.
c) Emergency Aids: I will address this challenge by commanding insurance company
to give people that in the insurance one time a month, because if they give
insurance money if there is a problem that will cause problem or losses to the
insurance people.
d) Poor agriculture risk infrastructure: to build insurance company or firm
infrastructure support because it is an important supply-side barrier to the
condition of agricultural insurance in the country.
e) Low risk awareness: I advice to the insurance firm to make high risk awareness
because people severe and they tend to underestimate the likelihood or severity of
disaster events.
3- Five actions farmers may consider to overcome difficulties in meeting agreed
repayment schedules or time on their loans:
I. Production of more crops.
II. Increase the price of their crop.
III. To produce their crops three times a year or more than.
IV. To get a good market for their production.
V. To request their government to stop or reduce the taxes of crops.