Sharp Increase in Crop Insurance Premiums for Agricultural Producers

Sharp Increase in Crop Insurance Premiums for Agricultural Producers

Michelle Pinon News Advertiser

Alberta NDP are calling out the UCP Government for its plan to increase crop insurance premiums by 60 percent.

Heather Sweet, Agriculture and Rural Economic Development Critic, said, “It’s clear that this government isn’t listening to Alberta producers…Alberta producers are seeing increased risk through supply chain disruptions, more extreme weather events, and an unstable investment network. But Alberta producers are resilient, innovative and resourceful. Our economy is reliant on these qualities. They deserve a government that doesn’t take them and their work for granted.”

She criticized the UCP by stating, “How a government that is boasting about a surplus they had no role in creating could fail to support Alberta producers, and in fact, choose to make it more difficult for them to survive, is unforgiveable.”

Sebastien Dutrisac harvesting one of his fields.

(Sebastien Dutrisac/Submitted Photo)

Fort Saskatchewan-Vegreville MLA Jackie ArmstrongHomeniuk was asked to comment on the increase to crop insurance premiums. She stated, “It’s unfortunate that the NDP would spread misinformation about crop insurance premiums. AFSC, (Alberta Financial Services Corporation) operates as a not-for-profit insurer and places caps on premium increase to provide security for producers facing fluctuations in crop values and rising input costs.”

Mackenzie Blyth, Press Secretary for Alberta Agriculture and Irrigation, said, “While producers can expect to see higher premiums for the 2023 crop year, they are not increasing by 60 percent. This year’s increase in premiums is actually an average of 22 percent over what producers paid in 2022, but will depend on the crop and producer. The increase is mainly due to higher crop prices, more producers participating in the insurance program and impacts from the 2021 drought.”

Blyth cited several examples of farming operations and the related increases:

• A 2,800 acre farm in Westlock growing a typical crop mix will see their premium, (producer share only) go from $68,000 to $74,000 - nine percent increase

• A 2,100 acre farm in Stettler again growing a typical mix will see their premiums go from $47,000 in 2022 to $56,000 in 2023 - a 19 percent increase

• A 1,750 acre farm in Strathmore, with 380 acres irrigated, will see premiums go from $89,000 in 2022 to $113,000 in 2023 - a 27 percent increase

AFSC stated in a March 5 news release that, “The 60 percent increase referenced in Alberta’s Fiscal Plan relates to the 2022 budgeted premium compared to the 2023 budgeted premium, and not actual premiums. Budgeted rates are estimates, prepared months before prices and premium rates are finalized. This year’s increase in premiums is actually an average of 22 percent over what producers paid in 2022.”

AFSC also stated that, “The increase is mainly due to higher crop prices, more producers participating in the insurance program and impacts from the 2021 drought. All efforts are made to ensure premiums remain affordable to clients, that coverage reflects the value of their crop, and that participation remains constant year to year.”

Sebastien Dutrisac, County of Two Hills Div. 4 Councillor and Agricultural Service Board Provincial Committee Chair, commented that: “With an increase of input cost and in crop value, we understand that premiums had to go up. Across the province, producers were affected by a series poor harvest which resulted in an increased number of claims at a higher payment to cover the losses. These crop insurance premium rates should follow the market more closely on a yearly basis or phase any huge variance over a few years to provide time for producers to adjust.”

Sebastien Dutrisac harvesting one of his fields.

(Sebastien Dutrisac/Submitted Photo)