Crop Insurance Claims Could Be Highest Ever

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“Some yields won’t ever recover, but producers might be feeling a bit better”

Crop insurance is getting a run for its money this year, with large numbers of claims coming in due to frost damage and dry conditions. Alberta Financial Services Corporation (AFSC) is looking at alternative ways to expedite all those claims in the most affected areas.

One solution announced by the province earlier this month is average area yields on a township level. This gives producers the options of having their crops released over the phone without an inspection.

Lorelei Hulston, insurance manager for AFSC’s central region, said in an interview that officers were falling behind with claims due to a flood of applications. By determining average area yields for the most severely affected areas, AFSC can delegate its adjusting resources to more moderately affected areas. Some adjusters have been moved around, but AFSC hasn’t added additional staff. “If a producer accepts the average yields for his area, then we can release the crops and follow up later on,” Hulston said.

She said there are typically many hail claims at this time of year, but most this year are related to frost and drought. As of July 6, there were 484 claims for crops, 330 claims for hay and 52 claims for hail in the central region. Hulston said hay and pasture crops are the most affected, as well as canola. “Some claims may be withdrawn as producers are still deciding whether to keep the crop or do something else.”

The central region received some relief on July 6, as it rained through the night. “Some yields won’t ever recover, but producers might be feeling a bit better,” Hulston said.

It also rained in the north region, where insurance claims are the highest in the province, improving the outlook for hay and pasture. There were 746 crop claims as of July 6, mostly for canola and cereal crops. Hail caused 47 claims, while producers submitted 178 claims for their hay.

In the driest areas, the first cut of hay is leaving barely anything behind to bale, said Faye Branden, insurance manager for AFSC’s north region. “Most of the region is in the same situation, except for some very dry pockets south and east of Camrose, where the pastures are affected in a big way,” said Branden. There’s a shortage of pastures across the region, with many producers converting poor cereal crops to make up for the lack of pasture.

Peace doing better

While there are dry patches in the Peace, most of the area is doing better than the rest of the north region, said Branden. “As a result, some crops are not doing too badly.”

Frost in late spring precipitated the high number of claims in the north so far this year. “We had frost every night for the first week of June, and that started the whole thing rolling. The drought put the icing on the cake,” Branden said. It’s had a very dramatic effect, especially on canola on peat-based soil. “We’re certainly using all the resources we have to process the claims,” said Branden. “If we are in need, that is, if we get further behind than we are, we will look at an alternate process.”

The south region has the fewest claims so far this year, with 102 crop, 38 hail and 62 hay claims as of July 6. Last year at this time, there were thousands of claim for hail damage. While it has been dry in the south, there is also more irrigation to aid crop development, although irrigated crops are a week or two behind. “We’ve recently had the challenge of dry weather and dormancy due to cold – crops are slow,” said Doug Dueck, AFSC’s insurance manager for the south region.

Frost in early June caused damage to some dry beans and canola, while drought is affecting dryland crops in the north part of the region, near Oyen and Brooks. “We have clients in Oyen and Brooks who are converting crops to pasture or taking them off for feed or spraying them out to conserve some nutrition and moisture for next year,” said Dueck.

As in the other regions, adjusters in the south are very busy. “They are trying to target folks who are trying to salvage some crops for feed,” said Dueck. “Secondly, anyone with hail damage or who is spraying out crops is also a priority.”

The corporation reminds producers that acres being put to an alternate use (including grazing or spraying) must be inspected and released by AFSC first. Producers should contact their AFSC district office five days prior to any alternate use, which allows AFSC to manage its adjusting resources and provide timely client service.

AFSC’s AgriInsurance is provided on a cost-shared basis, which typically is split with producers covering 40 per cent, the federal government covering 36 per cent, and the provincial government covering 24 per cent.

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