UNSAR welcomes the recent launch of Sub-measure 17.1. by AFIR – Romania’s Agency for Rural Investment Financing. “Insurance premiums for crops, animals and plants”, that allows the granting of subsidies for the payment of insurance premiums, a project that supports the Romanian farmers.
Thus, agricultural insurance is expected to become more accessible to farmers, protecting them from the risks they are exposed to and thereby contributing to the financial stability of their businesses.
“We are glad that this project started in 2016, has now been completed”. We had a very good collaboration with all involved authorities and farmers’ associations. The launch of this Sub-measure can be a real support for farmers, aiming to increase access to agricultural policies as well as to diversify the covered risks, “said Iulia NICOLA, General Insurance Specialist at UNSAR.
Starting April 1, 2019, farmers can apply for funding at AFIR, thus benefiting from coverage of a part of the eligible insurance premium, the deadline for the current session being November 30, 2019 The current session is intended to ensure spring crops and a new session will be opened at the end of the year for the financing of the insurance of the autumn crop. According to the information published by AFIR, the total amount of the available funds for farmers is EUR 42.7 million.
“Farmers will thus be encouraged to participate in risk management instruments by bearing from the funds made available through NRDP – National Rural Development Program of a part of the eligible insurance premium paid by the farmer. The mutualization system of the climate related risks through the insurance companies may help increase the coverage through insurance but also to develop the competitive environment. At the same time, this system brings the benefits of easy administration, based on the expertise and experience of the insurance companies but also on the safety and the confidence given by the requirements of the specific legislation and the supervision norms”, added Iulia NICOLA .
By accessing an agricultural insurance policy, farmers can benefit from financial protection against unfavorable climatic events such as floods, hail, torrential rain or excessive long-lasting rains, storm, thunder storm, hurricane, tornado, frost (early autumn, winter or late spring), drought or heat.
Subsidizing insurance premiums is also a common practice in other European countries, such as France, Italy, the Netherlands, Belgium, Portugal, Hungary, Croatia, Latvia, Lithuania or Malta, because the government support contributes to increasing the resilience degree of the farmers. Agricultural production can be significantly affected by the climate phenomena, and this support measure for insurance premiums facilitates the farmers’ access to insurance through which they can compensate for the losses resulting from natural disasters or other adverse climatic events. At the same time, the measure helps farmers play an active role in reducing the economic uncertainty of the agricultural sector caused by climate change.