New multi-peril, revenue-based insurance coverage available for farmers

Global Ag Risk Solutions, working with Lombard Canada Ltd., is offering a private, multi-peril, revenue-based risk management solution available to about 400 Western Canadian farmers.
Independent of all government programs, the solution provides guaranteed revenue above a farmer’s input costs (seed, fertilizer, chemicals), based on an appraisal of the farm’s financial track records. The insurance is designed to supplement, not replace, crop or hail insurance.
Put basically, a farmer estimates his or her input costs per acre and then adds in a “margin” of anticipated revenue based on the operation’s past financial history. The result is the amount of insurance coverage per acre.
So if a farmer spends $100 on input costs per acre, and estimates $100 of revenue per acre, the coverage would be for $200 per acre.
Using this example, if a “recognized peril” such as a price drop or production loss happens, and gross receipts come in under $200 per acre, a payout would be triggered and the insurance payout would make up the difference.
Under this form of insurance, as input costs rise, so does the insurance coverage. This is in recognition of the fact that good farming techniques will often increase a farmer’s costs.