National Association of Agriculture Insurers

NAAI President Korney Bizhdov: about 34% of the swine population and 25% of poultry in livestock farms are insured in Russia

In 2019, a marked recovery took place in the agricultural insurance system with state support: the insurance coverage of crops increased 4-fold, to 4.1 million hectares, making up more than 5% of the cultivated area. In livestock risks insurance, there has also been a double-digit increase, while those operations most vulnerable to epizootic risks – swine breeding and poultry farming – are at 34% and 25% of livestock coverage in agricultural enterprises and farmer households respectively. This was stated by the President of the National Association of Agriculture Insurers, Korney Bizhdov, speaking at the seminar "Insurance in the Media Mirror", held in Moscow on December 4th, 2019.

“In 2019, insurance with state support was carried out in all federal districts of the country,” said the President of NAAI. “The largest insurance coverage of crops this year (as of November 1st, 2019) was noted in the Central Federal District, where 1.2 million hectares were insured, which is by almost a 7-fold increase compared to a year earlier (175 thousand hectares); up to 1.2 million hectares, or an almost 3-fold increase, in insured area of crops in the Volga region. In the regions of the North Caucasus and the Ural, the agricultural insurance system is recovering from zero markets of last year. Compared to 2018, the Russian agricultural insurance market has grown 250%, to 4.1 million hectares. That is due to a number of factors, including main changes in the federal law, an active position of the Ministry of Agriculture of the Russian Federation, the NAAI and a number of regions. ”

According to NAAI, in 2019 the main insured crop group (77% of the insured sowing area) is represented by grains. On November 1st, 2019, the region leaders in crop insurance were Voronezh (569 thousand ha), Omsk (469 thousand ha) and Samara (335 thousand ha). In livestock risks insurance, a positive trend was also recorded (in comparison to 2018, for the 10 months of 2019 the insured population increased by 48% and amounts to 5 million head of livestock animals). The largest insurance coverage was recorded in industries such as swine breeding (7.3 million animals were insured, which is 42% higher than last year) and poultry farming (111.6 million animals were insured, 56% more than last year).

Of particular interest to the seminar participants were data on insurance payments for agricultural insurance, which over the past 7 years amounted to 31.1 billion roubles and exceeded the amount of state budget compensation in case of emergencies by 38%. The maximum payment for the agricultural risk insurance event in 2019 amounted to 570 million roubles and was paid to the farmers of Primorsky Krai, who suffered losses from swine foot-and-mouth disease.

Summing up the preliminary results of 2019, the President of NAAI also noted the importance of the awareness work carried out by the Association with regional agricultural producers: in 2019, more than 20 events were held (training seminars, conferences and meetings).

According to Federal Law N 260-FZ “On State Support in the Field of Agricultural Insurance”, within the framework of a centralized system, state support is provided for insurance of crop production, animal husbandry and commercial aquaculture risks. Since January 1st, 2016, a single all-Russian association has been operating in the agricultural insurance market with state support: the National Association of Agriculture Insurers.

In 2018, the Law “On State Support in the Field of Agricultural Insurance ...” N 260-FZ was amended, with the purpose of creating agricultural insurance conditions that are both more flexible and more diverse. The law entered into force on March 1st, 2019.