Risk management in agriculture is important, and likely to become more so in the future, and that the tools to manage risk are many, with agricultural insurance being only one of them. The experience with traditional, multi-peril crop insurance schemes throughout the world has been rather disappointing and Uganda as a developing country should learn from these costly and ineffective policies, and avoid repeating similar mistakes.The new tools, based on catastrophic insurance instruments, if used smartly in combination with already existing public policies and tools can be made very effective in managing weather and climate related risks facing Teso’s agriculture. Therefore, agriculture is inherently risky. Because it is risky, it can have large negative impacts on agricultural income, on food security, and the capacity of the sector to develop, invest, and compete in particular among the large, commercial farm enterprises. As a result, governments and public policies have historically and throughout the world been trying to address this problem.