National Association of Agriculture Insurers

NAAI and the Association “Greenhouses of Russia” discussed optimal insurance conditions for greenhouse vegetable growing

The National Association of Agriculture Insurers and the Association “Greenhouses of Russia” have agreed on the development of specialized insurance for vegetable farming of closed soil. The project started with a survey to identify the basic needs of greenhouse growers in risk insurance. The survey was conducted at a special seminar of the Association held in September, with the participation of NAAI. Based on its results, the parties will prepare joint specific versions of optimal insurance conditions for farms that produce agricultural products indoors.
“The risks of greenhouse production differ significantly from the risks faced by plant breeders conducting open-field production. First of all, productivity does not depend on natural factors. This greatly complicates the possibility of using insurance with state support in this segment,” said the President of NAAI, Korney Bizhdov.  “At the same time, if an emergency occurs at a greenhouse enterprise, then such losses are often catastrophic. A storm, hail, abnormal snowfall or fires leading to the destruction of greenhouses can cause damage to a single farm, amounting to tens of millions of roubles per event, and lead to a halt in production for a considerable time”, added the President of NAAI.
According to NAAI, from 2012 to 2018, singular cases of insurance with state support of closed-soil vegetables were noted in three regions: Stavropol, Primorsky Krai and the Republic of Bashkortostan. Greenhouses accounted for a 3% share of total premiums for vegetable insurance over the entire period.
From 2013 to 2018, the total area of greenhouses in Russia increased from 30.6 million square meters to 35.7 million square meters, with an increase in production capacity of 17%. The growing productivity of greenhouses is also worth noting: the gross production of greenhouse vegetables has almost doubled over this period (by 76%): from 615 thousand tons to 1.1 million tons in 2018.
The development of the greenhouse industry continues to be one focus of attention of government bodies. On 17 July, 2019, a meeting was held by the Deputy Prime Minister of the Russian Federation, Alexei Gordeev. According to its results, the Ministry of Agriculture, the Ministry of Finance and the Ministry of Economic Development of the Russian Federation were instructed to present a project on the up-to-twelve-year extension of investment loans provided at a reduced rate to farms for the creation or modernization of greenhouse complexes.
Since 01 January, 2016, the National Association of Agriculture Insurers is the single all-Russian association in the agricultural insurance market with state support. Insurance companies that are not members of NAAI do not have the right to conclude agricultural insurance contracts with state support. The creation of a centralized agricultural insurance system in the Russian Federation is provided for by the Federal Law No. 424-FZ of 22 December, 2014, on amending the Law “On State Support in the Field of Agricultural Insurance ...” No. 260-FZ. On 01 March, 2019, the Law “On State Support in the Field of Agricultural Insurance ...” No. 260-FZ was amended to increase the flexibility of agricultural insurance conditions for agrarians.