The weather insurance crop insurance program MeteoZakhyst was developed and implemented by Syngenta in Ukraine in partnership with the insurance company PZU and with expert support from the IFC (International Finance Corporation).
The pilot project was launched in 2016 in Kharkiv, Dnipro and Kirovohrad regions and covered 100 thousand hectares of two crops - wheat and corn.
The amount of insurance compensation received by agricultural producers according to the traditional insurance programs for the 2018 season is UAH 5.7 million. The main share of compensation came from farms in the southern and eastern regions that had significant losses in wheat harvest due to dry conditions during the flowering and filling periods.
For the farmers themselves, the new insurance product is even more interesting because they receive it as an additional option when purchasing crop protection products or other Syngenta products for free. All that is required of them is to enter the relevant data in the questionnaires and submit invoices confirming the purchase of the company's products.
Fixation of the insured event does not require the presence of the emergency commissioners and confirmation of crop loss - the risk assessment is performed according to the parameters of the index, depending on the received meteorological data. The farmer receives compensation for the funds spent on the purchase of Syngenta products within 5 days after the occurrence of the insured event.
In the new season, Ukrainian farmers will receive an additional option for crop insurance during the harvest, as well as the opportunity to participate in the small farms program (from 50 to 500 hectares) in Kharkiv and Luhansk regions that are willing to invest in agricultural technologies in order to get reliable protection for the future crop.
In addition, the index insurance program will expand its capabilities and will be available for farmers in the western regions. In addition to insufficient precipitation and excessive heat, insurance risks will inclue heavy rainfall. This summer, for instance, farmers faced the problem of torrential rains during the harvest period, which degraded the quality of grain.
"Syngenta pioneered agricultural insurance, giving its customers the opportunity to use such innovative insurance products as weather indexes - the most rapidly growing insurance product in the world! Transparency of the product and the rate of receipt of payments will serve as a positive factor for building confidence in insurance companies," - says Andrei Zaripov, an expert on agricultural insurance for the “Development of financing the agricultural sector in Europe and Central Asia” project, IFC.
Alyona Galtsova, Director of International Insurance Management in PZU, shares this opinion: "The agrarian sector is one of the most risky types of business, since its development depends not only on the market environment, financial and economic situation, the legislative framework, but also on weather and climatic conditions. PZU Ukraine is proud to create and efficiently implement the Index Insurance Program, not only as its own achievement but also as an innovative step in the development of the insurance services market of modern Ukraine."
Almost every season, both the producers and experts of the agricultural sphere note extreme weather conditions that are not characteristic of various regions, starting from critical droughts and severe frosts without snow to heavy rains and hail. According to forecasts of weather specialists, climatic changes in the future will only increase, accordingly, the demand for agricultural insurance programs for weather risks will only grow.
Photos provided by Syngenta.