In the wake of the joint joint committee between senators and MPs endorsing a more “muscular” version of the crop insurance reform, Groupama said it was optimistic that the latter would allow farmers a wider subscription to insure their crops. But maintaining or even raising insurance premiums will have to be offset by other compelling arguments from current carers. Otherwise, the goal of covering 60% of arable land by 2030 will be achieved.
With the increasing frequency of climate hazards in recent years, multi-risk climate insurance premiums should not go down, according to Groupama. (© Terre-net Media)
“Udoes not reform history, designed for farmers, incorporating insurers in a logic of public / private partnership, and based on the principles of solidarity and universality “: This was described by the representatives of Groupama at a press conference on Thursday, February 17, the project of climate risk insurance reform. A project that the senators had, on Wednesday, February 8, somewhat “muscular” compared to the version valid for deputies.
Following the holding of the Joint Joint Committee between Members and Senators, which strengthened the amended version, Groupama’s representatives were optimistic about the effects of this reform to save the device.
Because it’s about save the crop insurance device : since its inception in 2005, the rates of areas covered in large crops did not exceed 30%. Insufficient numbers, according to insurers, to be economically sustainable. The multiplication often aleas climates In the last five years, they have made it “untenable for insurers,” they said. The hazards of 2016 put the claims / premium ratio in the red and has not gone green since.
According to Groupama, the current insurance device is not acceptable. (© Groupama)
With a claims tax of more than € 200 million for the insurer alone Groupama, the exceptional frost episode last April after an equally unusual redoubt a month earlier was the “trigger” of the reform. Across France, “more than 80% of our viticulture members reported a disaster, representing 105,000 ha of damaged agricultural areas. Nearly 20,000 ha of better crops have resorted to the “re-seeding” guarantee, details of François Schmitt, farmer and president of Groupama Grand Est.
The year 2021 was, with the exceptional frost episode in April, the trigger for the reform of the multi-risk climate system. (© Groupama)
“Lower premiums on the agenda”
Reforms will not, however, be a basic synonym for insurance premiums, on the contrary. In a context of a “deficit” system, the multiplication of chances and, therefore, the potential for compensation would lead to an increase in premiums. Pacifica and Groupama had already announced it last November for 2022. “Given the evolution of climate change, the reduction of premiums is probably not on the agenda,” confirmed Pascal Viné, director of relations Groupama institutional arrangements. With all farmers who do not take out crop insurance due, in particular, to its cost, insurers will then have to find other arguments.
“Until now, there was a strong culture of state intervention,” especially for the most exceptional contingencies. The state will only intervene at the third and final level of the system, ”recalls François Schmitt. “And if the state’s intervention with the uninsured decreases, it will mechanically increase the number of policyholders.” »
And just like the government, the first agricultural insurer is counting on the need for pedagogy to be done with young people. “It’s a real pedagogical effort to do! Choosing to insure against the consequences of a hailstorm on your crops should be like deciding to treat your plots once or twice against a disease. »
These arguments will have to be strong enough to convince young farmers to insure in the long term, and thus achieve the objectives of covering the scheme now annexed to the text of the reform: by 2030, it is, according to the report by Frédéric Descrozaille, opening 60% of the area under large crops and vineyards (compared to 30% in 2020), 30% of fruit crops (compared to just over 4% in 2020) and 30% of meadows.
The goal of crop insurance reform is to at least double the area coverage of crops and vines. (© Groupama)
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