Changes to insurance relied on by Alberta producers will range this year from increasing the coverage for hail damage to ensuring more timely payments for moisture deficiency claims for pastures.
“We’re always talking to our clients to see what would help them and what would make our programs more relevant, and this was the feedback from them,” said Emmet Hanrahan, vice-president of product innovation for Agriculture Financial Services Corp.
Alberta experienced intense hailstorms in 2022 that included the largest hailstone ever found in Canada. Only a year earlier, record-breaking heat waves and drought caused livestock feed shortages.
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Scientists have linked climate change to a general increase in the frequency of severe weather events. However, Hanrahan said the trend is only one of several potential factors that can affect insurance coverage, such as commodity prices and markets, that are being monitored by AFSC.
He said he could not comment on whether the provincial crown corporation expects claims from farmers will increase due to climate change.
“Up until 2021, we’ve had actually some really good years where we hadn’t seen a high intensity of claims and I don’t think I have a comment on that.”
However, AFSC has decided to switch to monthly payments for the Moisture Deficiency Insurance program for pastures to ensure recipients get their money more quickly.
“This will allow producers to be more agile as they access water, buy feed or take other steps to deal with dry conditions,” said a statement by AFSC.
The program compensates producers during periods when the accumulated precipitation at selected weather stations declines below what is normally expected. “That’s anybody that’s growing forage really because we’re growing pasture,” said Hanrahan.
AFSC has also increased the maximum coverage limits under the Straight Hail Insurance program, said the statement.
“Last summer’s intense hailstorms affirmed the need to ensure hail coverage meets the needs of all producers, including market garden producers.”
Hanrahan said market gardens involve more intense farming in terms of the number of plants, which means such operations tend to be worth more per acre.
“And also, some of the rules that we had in the program were reviewed to make it more flexible for market gardens, such as strawberry producers, to participate should they choose.”
AFSC is working with the market garden sector to gather information and look at longer-term options besides Straight Hail insurance to improve risk management, said Hanrahan. It includes holding two input advisory group meetings in January, he said.
Changes have also been made to the reseeding benefit compensation rate to place it more in line with current reseeding costs. The program is intended to partially repay producers for the cost of reseeding the original crop on a spot-loss basis for acres damaged by designated perils before June 20.
Meanwhile, a pilot project for predation of hives and bees by bears has been added to the Wildlife Damage Compensation Program, said Hanrahan.
As well, AFSC is cancelling the Satellite Yield Insurance program, which provided coverage for southeast Alberta. The region’s lack of tree cover made it suitable for the program, which was established about 20 years ago, said Hanrahan.
It used data from satellites that was processed using the Normalized Difference Vegetation Index (NDVI) to determine variations in live green plants such as crops, he said. However, AFSC was told this fall a third-party provider of the data was having technical problems with their ground receiving stations, “so we had to make a decision to cancel that program.”
The same sort of risk is being covered by the Moisture Deficiency Insurance program, which is offered across Alberta, said Hanrahan. “Producers have the option to transition to that program and our staff are reaching out to them here to discuss options with them.”
Although the Satellite Yield Insurance program has ended, AFSC will continue to look at ways to help farmers through innovations in technology, he said. “And if there’s something else that comes up that works really well that we can use, we’re certainly looking out for that.”
