Drought Index, the first drought insurance product brings new benefits to Romanian farmers in the agricultural year 2021

25 February 2021 — press.release
Agra Asigurari aids the farmers with new benefits for agriculture in 2021. Drought Index and Agrar Basis become the same policy with additional advantages, such as providing soybean crops insurance and compensation for a lower precipitation deficit of 30%.

According to Agra, farmers can get financial compensation for the damage caused by drought, hail, and other natural disasters on crops, through a simple and non-bureaucratic risk underwriting process. The damage assessment is transparent, and its calculation bases on historical parameters provided by the 121 meteorological stations accredited by ANMH, also included in the insurance product for drought and heat.

Adrian-Horia Lupu, General Director of Agra Asigurari Romania commented: "Given the precarious situation of irrigation systems in our country, drought insurance is meant to support Romanian farmers. Since its entrance into the Romanian market, Agra Asigurari has brought several insurance products, including Drought Index, that was a unique insurance product in the market back in 2015", stated.

New benefits introduced in the Drought Index 2021

Starting with 2021, Agrar Basis and Drought Index become the same insurance policy to support farmers, adapted to the field reality. Drought Index is a supplement to the Agrar Basis policy in the context of sub-measure 17.1 and comes with several new features and benefits to strengthen support for farmers.

The most important advantage is the subsidy granted by the Agency for the Financing of Rural Investments. Since 2019, drought and heat are risks eligible by AFIR through Sub-Measure 17.1. The financial supplement agreed in the Drought Index policy can be granted together with the large crops policy, Agrar Basis. Thus, the farmer has the crop insured both for the risk of drought and for hail or frost, in a single policy. At the end of this policy, the farmer can choose the insured amount per hectare for each crop and the reference weather station for the precipitation level.

Soybean crops can benefit from the insurance policy, along with fall wheat, corn crops, and sunflower starting this year.

Agra Asigurari makes available to farmers a new option available at the end of the policy, the 60/30 compensation option. In this sense, drought compensation starts from a lower deficit of precipitations, an advantage for farmers. Remuneration is also granted on each percentage point of the rainfall deficit and the entire insured area mentioned in the policy.

Farmers now also benefit from an extended deadline until 30.04.2021 for subscribing policies for sunflower, corn, and soybean crops. For autumn wheat cultivation, the deadline for submitting the insurance application is 26.02.2021.

Retrospective and challenges of the 2019-2020 sales season

The events triggered by the drought and the global crisis generated by the pandemic of the Covid-19 virus amplified the negative impact on the farmers. This required an assessment of the damage by the safety measures imposed by the authorities.

The future of crops sown in the spring of last year, which were affected by the drought, is still in question. There is no official decision on this compensation from MADR yet.

"The Agra Asigurari team wants to respond promptly to the requests for insurance and crop evaluation, guaranteeing safety and continuity in this sector. The context of social distancing and the transition to online activity has been a challenge for both the insurance market and the agricultural industry. However, we are looking at a successful sales season and we are glad that we managed to be with the farmers even in this difficult period ", added Adrian-Horia.

Source: Agra Asigurari Romania

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