March 6, 2005 by Canadian Underwriter
The Saskatchewan Wheat Pool is announcing a new insurance program for fiscal 2006 to cover grain volumes.
The coverage, developed with reinsurance broker Aon Re Canada Inc., is intended to help earnings and cash flow stability in years of poor grain volumes, with grain handling being the pool’s core business. The program provides maximum payment of $30 million, with partial payments triggered if productions falls by more than 20% and full payments triggered by a 45% drop in production. Coverage is for volumes of the six major crops in Western Canada wheat, barley, canola, oats, peas and flaxseed as reported by Statistics Canada.
Our new coverage will better position the Pool to maintain cash flows at levels that will adequately prevent financial deterioration for the company if the industry experiences low production due to weather or other unpredictable events," says Wayne Cheeseman, CFO of Saskatchewan Wheat Pool.