About $5 million will have been invested in agricultural insurance in the next three years, agriculture minister Ignaty Arakelyan said today during a parliamentary discussion of the 2018 draft budget. He said 885 million drams will be invested in a pilot agricultural insurance project to be launched next year, saying also that the ministry is confident that the results of the pilot program will allow it to understand exactly how to introduce this system across Armenia.
Armenia’s agriculture ministry has embarked on ambitious reforms with an unpredictable multiplicative effect, Karen Karapetyan, Armenian prime minister, said Thursday at a regular Cabinet meeting, where the Cabinet ministers upheld the concept of lessening damage from natural disasters through enhancing agriculture sector’s resistance to such disasters, cushioning their strikes and introducing early warning mechanisms.
Effects of climate change such as drought and flooding on agriculture, coupled with crop diseases, have continued to ravage crops in recent years, causing losses on farmers' investments. For instance, in Eastern Province districts of Kayonza and Nyagatare, some of the farmers did not get any harvest over the last two planting seasons because of prolonged drought. These issues of concern in agriculture sector have necessitated the urgent need for agriculture insurance, at least for farmers to get some compensation for crop damages.
Crop insurance policies fall under two primary categories: crop hail insurance and multi-peril crop insurance. Crop hail insurance is limited to losses due to fire and/or hail. Multi-peril crop insurance (MPCI) provides extensive coverage for losses from weather to pests and even loss of revenue. In many cases, multi-peril policies are subsidized and backed by a federal reinsurance program.
New dates and place of the International Conference "Agricultural Insurance, Reinsurance & Brokerage in CIS, Europe & Asia" were set for October 6-8, 2014 in Istanbul, Turkey. Conference `Standard registration’ fee option has been launched on August 1, 2014. Conference Agenda will keep most of the topics planned earlier, as well, as it will be added with new speakers and topics. Quite a number of reinsurance and insurance industry representatives, brokers and insurance consultants from USA, Canada and Eurasia territories will participate in this event.
Agriculture is an inherently risky business. It is subject to a number of random price, climatic, biological, and geological shocks that require coping strategies and financial management instruments to deal with the implications. Traditional risk management strategies and ex post government provided emergency relief have often not proven to be sufficiently effective and robust in preventing serious economic loss or permitting a speedy recovery.
From 23rd until 25th of June 2014 Polish Reinsurance Company organized in Torun VI International Seminar on agricultural insurance. This time the Agro Seminar was dominated by three thematic blocks, all dedicated to crop insurance. Furthermore, Konrad Rojewski (Polish Re) discussed the Polish agricultural insurance system and referred to the recent legislation of the European Commission determining the possibility of subsidizing agricultural insurance. Then he presented a method how reinsurers analyze the crop portfolios of their ceding companies.
Small-scale farmers in developing countries can no longer absorb the negative impacts of climate threats within their traditional risk management strategy. One supplementary risk management instrument could be agricultural insurances. But they need to be tailored to the specific needs particularly of small-scale farmers, a great challenge for the insurance providers.
The Insurance companies can co-operate with insurers and use meteostation’s data for the risks control. The station allows getting weather information in the real-time regime for exact time determination of the risk event beginning, descriptions of risk and duration of influence on the insured crops or animals.
In 1997 Kazakhstan introduced mandatory agricultural insurance through a special provision in the Insurance Law. Agricultural insurance services were offered through a specialized state insurance company named Kazagropolis, but the agricultural insurance uptake was low. During the period from 1998 to 2002 the number of insurance companies offering agricultural insurance decreased from 13 to 7. Premium rates were high, reaching 20%. In 2003 the government adopted a law on the state regulation of finance market and finance institutions. In 2004 a law on mandatory crop insurance was adopted. Currently agricultural insurance is mandatory for all crop producers.
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