Program Information for Annual Crop Insurance 2022
Working in agriculture requires the ability to withstand unpredictable events. To protect producers from designated perils that lead to production loss, Agriculture Financial Services Corporation (AFSC) provides a suite of insurance programs.
These programs provide:
- protection for producers from financial losses due to circumstances beyond their control
- coverage for many types of operations including commercial, organic, pedigreed seed and specialty cropping.
What’s new for 2022
Silage Greenfeed Insurance – Lack of Moisture: Following the changes made to Moisture Deficiency Insurance for pasture, AFSC has included the new dual trigger feature for silage as well. Changes include a reduction in recorded precipitation by 1.0 mm when daily temperatures reach 30 C, and by another 2.0 mm for a total of 3.0 mm when temperatures reach 35 C. As well, the minimum moisture threshold has increased from 0.1 mm to 1.0 mm.
Straight Hail Insurance: Changes have been made to the base hail rate for field peas and canola;
- Canola base rates have decreased from 1.75 per cent to 1.5 per cent.
- Yellow and green/other field peas base rates have increased from 1.5 per cent to 1.75 percent.
The change to the factors was a result of a review of the straight hail premium rates. The factors for these crops were adjusted to better reflect the expected losses for these crops based on analysis of the historical experience of the premiums collected and indemnities paid.
Other changes to Straight Hail Insurance include:
- Fields that have previous hail damage are not eligible for Straight Hail Insurance.
- July 31 is the deadline to purchase Straight Hail Insurance.
Weather Stations: One new weather station, Wardlow, has been added to the network of weather stations available across Alberta while Violet Grove weather station has been decommissioned. Two weather stations, Dapp and Bow Island North, have been replaced with Pibroch and Winnifred respectively.
- Clients who had selected Violet Grove, Dapp or Bow Island North in the previous year can update their selected weather stations by completing a Change Request prior to April 30.
As weather stations are subject to change please review the Weather Station Map or visit your branch office for a current list of weather stations.
Higher dollar coverage due to higher commodity prices
Producers will see increases to both coverage and premium this year primarily due to significantly higher commodity prices for the 2022 crop year. The spring insurance prices for annual crops have increased by an average of 37 per cent and the available dollar coverage will increase by the same percentage. The average dollar coverage has increased to an estimated $501 per acre, up from $365 per acre last year. The investment producers will have in the ground this year will be higher than ever, due to rising input costs and the expected value of the crop.
While producers will be paying more for insurance due to increased dollar coverage caused by high commodity prices, the premium rates to insure have not risen as dramatically. AFSC recognizes the impact increased premium costs will have on producers and annual premium rate increases are held to a maximum of 10 per cent.
We encourage you to contact your Relationship Manager Insurance to discuss your specific situation and options to handle the increase while managing your risk. For more information, please see the news post Producers can expect to see higher dollar coverage due to higher commodity prices
Alberta Premium Reduction discontinued due to extreme weather events of 2021
Last year, based on a healthy insurance crop fund reserve, AFSC was able to provide clients with a 20 per cent premium reduction on the majority of insurance premiums. The plan was to reevaluate the premium reduction annually and adjust based on the events of the previous year. Due to the major weather events of 2021, claim payouts are predicted to be the highest in AFSC’s history. This will result in a significant decrease in the fund reserve, making the Alberta Premium Reduction unsustainable and the discontinuation of the initiative for 2022 and subsequent years.