This law increases the size of the state subsidy to be paid as a part of the insurance premium when insuring against the risk of loss of crops as a result of natural disasters. The subsidy for the first year will be 80% for all policyholders. The document also provides for the formation of a fund of compensation payments in case of emergencies at the expense of deductions by insurers of a part of insurance premiums received under agroinsurance contracts. The amount of such deductions, according to the law, is established by the association of insurers for the relevant year but cannot be less than 5% of the received insurance premiums.
The new rules will enter into force on July 1, 2021, and the provisions of the law on implementation of compensation payments for damage due to emergencies will apply from July 1, 2022.
"The new rules will enable agricultural producers of all forms, in the event of an emergency in the region, to receive insurance compensation under simple and affordable conditions, without waiting for the harvest", said the President of the NAAI (National Association of Agricultural insurers).