January 19, 2016 by Canadian Underwriter
AgriInsurance – a business risk management program supported by the Canada and Manitoba governments – announced on Tuesday that coverage will increase an average of 7% this year, while the average premium per acre will decrease by 4%.
The federal and Manitoba governments are supporting AgriInsurance changes, giving producers higher coverage at a lower cost for 2016, Federal Agriculture Minister Lawrence MacAulay and Manitoba Agriculture, Food and Rural Development Minister Ron Kostyshyn said.
AgriInsurance, administered through the Manitoba Agricultural Services Corporation (MASC), has been updated for 2016 based on producer feedback and market conditions, Manitoba Agriculture, Food and Rural Development said in a press release.
Changes to programs for 2016 include:
* Due to higher average insured dollar values (prices) and probable yields, AgriInsurance coverage will increase an average of 7%, while the average premium per acre will decrease by 4%;
• Grade guarantee for feed wheat
* A grade guarantee for feed wheat has been added to protect against quality losses;
• Vegetable acreage loss insurance program expanded
* This program, which mitigates risks associated with vegetable production, has been expanded with the addition of four crops;
• Pasture days insurance program expanded
* Previously limited to 90 producers, this program has been expanded province-wide for the next three years, compensating livestock producers for pasture shortfalls and/or supplemental feeding; and
• Wildlife damage compensation
* After April 1, the maximum compensation value will increase for animals injured or killed by livestock predators. Additionally, the compensation for young animals will be revised to reflect what would have been the value of the animal at weaning weight, rather than at the time of loss.
This year, MASC will provide an estimated $2.4 billion in coverage for 8,500 Manitoba farms. Under AgriInsurance, premiums for most programs are shared 40% by participating producers, 36% by the Government of Canada and 24% by the Government of Manitoba. Administrative expenses are paid 60% by Canada and 40% by Manitoba.
“AgriInsurance stabilizes a producer’s income by minimizing the economic effects of production losses caused by natural hazards,” MacAulay said in the release. “The Government of Canada continues to work closely with Manitoba to help make production insurance affordable.”
Kostyshyn added that “financial stability, especially during production shortfalls, provides an important level of support.”
The latest announcement came a day after Kostyshyn said that MASC will be providing expanded hail insurance coverage. MASC’s hail insurance, which covers hail and accidental fires and is available to producers participating in AgriInsurance, has been expanded to include winter squash, pumpkins, peppers and leeks. As well, maximum coverage for strawberries has been increased to better reflect the associated cost of production, the minister said in a statement on Jan. 18.
A new, one-time interest rate credit will also be available to cattle producers after April 1. Through MASC’s Stocker Loan program, producers financing feeder cattle will receive a credit of 0.25% if they also purchase a Western Livestock Price Insurance Program policy fully covering those animals.