World’s farmers up crop insurance to a record $24B

Reading Time: < 1 minute

BriefS

london / reuters Farmers have spent 20 per cent more on agricultural insurance in recent years to protect against crop losses from increasingly frequent bad weather events, according to reinsurer Swiss Re.

The rise in extreme weather disasters, such as last year’s widespread U.S. drought, has reduced food output at a time when the world’s population is expected to grow by a third by 2050, the world’s second-biggest reinsurer said in a report. Global agricultural insurers took in $23.5 billion in annual premiums in 2011, up by a fifth from 2005, Swiss Re said.

China and India accounted for nearly two-thirds of the $5 billion in premiums paid in emerging countries. Swiss Re said the agriculture insurance market could still grow fourfold in emerging markets.

washington / reuters Crop insurers have paid a record $11.6 billion to U.S. growers in compensation for losses due largely to widespread drought in 2012.

Some analysts expect indemnities to reach $20 billion this year, nearly double the old record set in 2011. That would mean steep losses as insurers collected just over $11 billion in premiums.

Washington not only pays 62 per cent of premiums but is on the hook for about three-quarters of underwriting losses. Crop insurance is the largest U.S. farm support.

Some 85 per cent of eligible farmland, 281 million acres, was covered by $116 billion worth of policies in 2012.

Comments

explore

Stories from our other publications