The agricultural risks insurance program was launched in Armenia in September 2019 and already has shown its effectiveness, exceeding the expectations of insurers, according to Levon KOCHARYAN, specialist in agroinsurance and Head of the Underwriting department at INGO Armenia, ArmInfo reports.

KOCHARYAN noted that the Agriculture Insurers National Agency (AINA) under the Central Bank of the Republic of Armenia prepared a sufficient number of specialists - damage assessors for the start of the project, but more than half of them abandoned work after the pandemic started. This caused certain difficulties in terms of receiving insurance compensations in an expeditious manner under the program.

According to the specialist's estimates, loss ratio of agroinsurance was 100-110%, which is quite a good indicator for initial development stage of this new segment. KOCHARYAN believes that over the next 2-3 years, this segment will be beyond high unprofitability and the level of risk reinsurance will remain at 90%.

For 1H2020, GWP collected under agroinsurance reached AMD 131 million (~EUR 0.24 million*), of which 82.2% was ceded to reinsurance. According to the Financial Rating of Insurance Companies of Armenia, prepared by ArmInfo, ROSGOSSTRAKH Armenia is leading in terms of GWP, collected in the segment (AMD 73.6 million) among the three partner companies of the program, INGO Armenia ranks second (AMD 35.4 million), and SIL Insurance ranks third. Paid claims in the reporting period amounted to AMD 8.4 million.
* for the following exchange rate:
1 EUR = 540.44 Dram - AMD (June 30th, 2020)