Currently, there are nine insurance companies operating on the agricultural insurance market in our country. These are companies that have signed an agreement with the Ministry of Agriculture and Rural Development and use the system of subsidies for agricultural crop insurance. Agro Ubezpieczenia is also operating among these companies.
This name has been in use since 2022, previously it was Pocztowe Towarzystwo Ubezpieczeń Wzajemnych. As the president of Agro Ubezpieczeń Daniel Zahorenko says in an interview, at some point the capital of the farmers' social insurance contribution fund was involved in building the company's structure. It was created in order to be able to create the insurance market, have tools to influence this market and to provide opportunities to protect the interests of farmers.
– Farmers have de facto built up the capital of the contribution fund, so we can say that farmers are co-owners of Agro Ubezpieczenia – says president Daniel Zahorenko.
The market is promising
As he adds, when they joined the players in agricultural insurance, they were the fifth insurance company specializing in this area. Currently, there are already 9 entities, which shows that the market is promising.
For example, data is provided here. In Poland, it is assumed that the total area of crops is about 10 million ha. In the record year, farmers insured just over 4 million ha, so this gives room for action, because 6 million ha still remain without insurance protection.
– In the model approach from the point of view of the interests of the Polish state, it seems that the level of 80-90% in terms of insured area would be the level at which the liability for losses in agriculture would be removed from the State Treasury and this is certainly a desirable model, but there is still a long way to go – says Zahorenko.
As he points out, there is still a lot to be done, because although there are so many entities operating on the market, not every entity offers a wide range of agricultural insurance. According to our interlocutor, farmers should be provided with greater opportunities to conclude insurance offers when it comes to risky crops (orchards, soft fruit, field vegetables). In these crops, the loss ratio is quite high and there is a high probability of damage occurring during their vegetation.
In this situation, there are only 2-3 companies left in the fight that provide such opportunities, but seeing the high risk of damage, they also limit access to this type of insurance protection. As mentioned in the conversation, the ongoing work on amending the Agricultural Insurance Act, concerning subsidies for crop insurance, gives some hope for creating better protective mechanisms in this area as well.
What beyond crop insurance?
There has been a leap not only in crop insurance, but also in machinery insurance. Farmers are buying increasingly advanced technological machines and devices, often on a leasing basis and/or in connection with a loan for their purchase. Therefore, the offer of insurance in this area is also developing intensively. It is similar in farm animal insurance, but there is still a lot to do in this area. As Zahorenko pointed out in the interview, the offer must also be compatible with the changes that are introduced, for example, along with the implementation of the European Green Deal.
The full interview is available in the video below:
