Ritz positive about insurance program

After years of discussions and a largely successful pilot project in Alberta, federal agriculture minister Gerry Ritz says he is confident 2014 will produce significant progress in trying to create price-based livestock insurance.


He is predicting a multi-province scheme by 2015.


Part of the reason for the optimism is growing government and industry support as well as creation of a research chair position at the University of Manitoba to consider model design.


“There’s a growing appetite for pilot projects in the western provinces where most of the cattle are,” said Ritz. “There is a growing recognition at the federal, provincial and industry level that that’s where we need to go so some of the pieces are starting to fall into place and 2014 might be the year.”


Ritz also credits changes that federal and provincial governments enacted this year to make Growing Forward 2’s business risk management programs less lucrative for producers.


Changes that took effect April 1 reduce the payout trigger for AgriStability from a 15 percent eligible income drop to a 30 percent drop.


At the same time, governments are reducing matching dollars contributed to the AgriInvest program meant to give producers an added 15 percent coverage above AgriStability.


Ritz said an Alberta livestock insurance pilot program had limited interest because other programs were too lucrative.


“We’re pushing hard for an insurance-based program in livestock that will more than offset that 15 percent (trigger reduction) in AgriStability,” he said. “We found a reluctance of farmers to pick up a premium for livestock insurance when it’s been 100 percent coverage under other programs. Everybody’s complained about bankability and predictability, but at the end of the day when you have 100 percent of a sure thing, why pay a premium?”


Ritz said the changes were in part to convince producers “to look at that livestock premium in a more pragmatic way.”

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