More grain farmers are expected to take up multi-peril crop insurance this winter growing season.

Last year, Latevo International was the first company to offer this particular type of multi-peril insurance, which covers farmers' costs of production in the case of drought, flood, fire, hail, wind, frost, lightning, cyclone, insect or pest infestation, as well as other potential perils.

Twenty-nine farmers took out policies with Latevo last year. CEO Andrew Trotter said Latevo had increased its customers ahead of this year's growing season, with 150 growers signed up across the country.

"They start for Geraldton in the west and they go all the way to southern Queensland," Mr Trotter said.

"It is absolutely essential, when you run a national insurance program like this, if you don't have good geographic spread you can find yourself very exposed.

"A great example would be, if you were concentrated in western Victoria last year, it really would have hurt the program because the season was so bad."

Latevo is not the only company offering multi-peril insurance in Australia this year. The Allianz insurance group, which underwrote Latevo's policies last year, is one of those offering multi-peril insurance this year.

Latevo announced this week it had partnered with Assetinsure in an agreement supported by global reinsurer Swiss Re to provide multi-peril insurance.

Government assistance for growers

There has been much speculation that the Federal Government's agricultural competitiveness white paper will include a recommendation that government provides farmers with a financial incentive, in the form of subsidies, or tax breaks, to take up multi-peril insurance.

Earlier this month, chair of the Coalition's backbench agricultural committee, Dan Tehan, gave an indication the government may be considering an incentive to nudge farmers into insurance as an alternative to drought support.

Victorian grain grower and state farmers' federation grains president Brett Hosking said without government incentives, multi-peril crop insurance was a huge expense for farmers.

"I think at this stage what we are seeing is the cost is the biggest deterrent and I guess what you get back as a grower from that investment," Mr Hosking said.

"I think to see widespread uptake of multi-peril crop insurance in Australia and to make it affordable and manageable for businesses going forward, there is an essential role there for government."

Source - http://www.abc.net.au/