Insuring crops is becoming increasingly expensive. Increasingly frequent storms, frosts and long-term droughts, climate change The compensation that Agroseguro, the pool of companies responsible for these policies, had to pay increased rapidly and, as a result, increased Premium cost to producers. So much so that many call it “a luxury goods“In the words of the technical secretary Asaja Alicante, Ramón Espinosa.
It has a price only in recent years already increased by about 50% and calculate a from the organization for the next financial year: new average increase of an additional 15%, This rate can exceed 30% in the grains most affected by the different weather events that occurred this year.
The current agricultural insurance system in Spain is The first major law passed with the advent of democracyAs Espinosa recalls, it has long served as an example to other countries. public-private system administrations –Ministry of Agriculture and autonomous communities through Enesa- undertake a significant part of the cost In the Valencian Community this rate exceeds 60%.
“The problem is that this system failed to adapt to the new reality, the increase in accidents caused by climate change“says Espinosa, who demands a larger contribution from the central government for Agroseguro to remain sustainable, without having to further increase the bill for producers.
Total cost so far this year in the case of the province of Alicante contracted premium amount 18.8 million eurosFarmers have to pay just over 35% of that. This is some 5% higher hired him at the same time last year, but insured area falls by almost 3.6%Up to 27,152 hectares.
Because, according to Asaja’s technical manager, one of the consequences of this price increase is as follows: Many manufacturers are giving up on insuring their productsWith the risk this represents, especially among small farmers. “Oftentimes, after a natural disaster, small producers without insurance quit operations,” Espinosa laments.
In terms of compensation paid, due to the lack of provincial data, the head of the agricultural organization recalls the latest figures known at the national level. For this reason, By last September, Agroseguro had paid almost $1,000 million euros this year compared to 650 million euros in the same period last year. If this trend continues, there will be around 1.2 billion by the end of the year, although “until a decade ago it was normal to have around 500 million per year.”
Less coverage
To compensate for increased expenses caused by climate change, the insurance pool is not only increasing premium costs but also taking other measures that harm farmers. For example, a fairly common one increase franchise percentagethat is, the amount that the farmer must pay alone in case of an accident, as in car insurance. They also reduce the type of coverage. Thus, when it comes to lemons, the most common product in the province, They eliminated wind coverageIt causes scratches on fruits and affects marketing opportunities.
Ramón Espinosa also points out another product: Cherryalready accumulated five years of bad harvest As a result of the warming climate—”This is a tree that needs hours of cold,” he recalls—and other atmospheric phenomena in the state threaten its survival.
cereals They are among those most affected by the change in weather conditions, so much so that drought caused plants to not grow in many production areas last year, and they could not be planted this year either.