“While there still appears to be significant interest from growers and the media in multi-peril crop insurance, we estimate the total number of policies purchased by growers was less than 200 this season,” Managing Director, John van der Vegt said.
“With the first MPCI products introduced back in 2014 it is hard to envisage what lies ahead for these products but its clear that the limited uptake will certainly have insurers questioning the short to medium term viability of their products,” John said.
AgriRisk believes the reasons behind the low numbers are complex and include:
• A significant mis-match between insurer’s premium requirements and grower expectations. Most growers suggesting that the premiums are unaffordable.
• Whilst the Government can see merit in supporting MPCI, it has to date only offered a rebate to assist growers in applying for MPCI cover and has shied away from a direct premium subsidy which is often critical to underpin MPCI programs.
• Depending on the product, the application process can be arduous and many growers simply don’t have the depth of historical data required.