LATVIA: LAA: Agroinsurance grew by 17% last year

12 April 2022 —
Farmers in Latvia are increasingly using insurance as a risk management tool, and in 2021 GWP in the segment reached EUR 19.4 million, which is 17% more y-o-y, according to the Latvian Insurers' Association (LAA). Last year, crop insurance reached EUR 11.6 million, livestock insurance - EUR 7.5 million, and insurers paid EUR 9.2 million to farmers.

"Agricultural insurance is very interesting in many respects. Firstly, our farmers had to shift their thinking from claiming public compensation for each natural event to an effective risk management model that also includes crop and livestock insurance. Second, insurers cooperate with the Rural Support Service, which administers payment of state aid. And, thirdly, with the growing interest of farmers and competition between insurers, we need to think about additional insurance protection and indemnity service that we can offer to farmers", says Janis ABASISNS, President of LAA.

Crop insurance has grown steadily over the last eight years - in 2014-2016 only 40-66 farmers insured their crops, then in 2021 there were already 939 such farmers, and the insured areas are growing. Livestock insurance also has steady growth - since 2014, the number of farmers with livestock insurance has fluctuated around two thousand, reaching 1941 farmers in 2021.

One of the main drivers is state support, which has been available to farmers since 2015. In 2022, the state budget for farmers will cover up to 70% of insurance policy cost, but not more than 50 euros per hectare or per cattle unit. Insurance is also boosted by weather negative effects.