What was new in annual crop insurance in 2022
Silage Greenfeed Insurance – Lack of Moisture: Following the changes made to Moisture Deficiency Insurance for pasture, AFSC 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 decreased from 1.75 per cent to 1.5 per cent.
- Yellow and green/other field peas base rates increased from 1.5 per cent to 1.75 percent.
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 included:
- 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, was added to the network of weather stations available across Alberta while Violet Grove weather station was been decommissioned. Two weather stations, Dapp and Bow Island North, were been replaced with Pibroch and Winnifred respectively.
Higher dollar coverage due to higher commodity prices: Producers saw increases to both coverage and premium primarily due to significantly higher commodity prices for the 2022 crop year. The spring insurance prices for annual crops increased by an average of 37 per cent and the available dollar coverage increased by the same percentage. The average dollar coverage increased to an estimated $501 per acre, up from $365 per acre the year prior.
While producers paid more for insurance due to increased dollar coverage caused by high commodity prices, the premium rates to insure did 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.
Alberta Premium Reduction discontinued due to extreme weather events of 2021: In 2021, 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. Due to the major weather events of 2021, claim payouts were predicted to be the highest in AFSC’s history. This resulted 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.