On April 26, Russian Minister of Agriculture Alexander Tkachev presented at a government meeting held by Dmitry Medvedev the draft federal law “On Amending the Federal Law“ On State Support in the Field of Agricultural Insurance and on Amending the Federal Law “On the Development of Agriculture”, aimed at improving the mechanism of agricultural insurance with state support.
Alexander Tkachev noted a decline in the agricultural insurance market. According to him, the decline in the dynamics of agricultural insurance is explained by a high threshold for the loss of crops and an insufficient list of insurance claims, a low level of insurance indemnity payments, difficulties in proving the occurrence of an insured event, which increases the distrust of agricultural producers in this tool to level risks.
The draft law proposes to exclude the threshold for the loss of agricultural crops and establish a mandatory unconditional deductible of at least 10%, which will increase the interest of agricultural producers working in regions favorable for agriculture and will also help to maintain the average size of insurance tariffs and the size of insurance premiums.
The amendments will expand the range of cheap insurance products, including obtaining insurance coverage in amounts commensurate with the size of direct production costs for growing crops, and increase insurers' interest in working in risky farming zones.
A bill prepared by the Russian Ministry of Agriculture also proposes to expand the list of risks in insurance with state support. Now, the agricultural producer will be able to receive reimbursement if the state service has made a forced slaughter of insured agricultural animals in order to prevent the spread of contagious diseases.
The bill was approved by the Ministry of Economic Development of Russia and the Ministry of Finance of Russia, supported by the Ministry of Justice of Russia and the Institute of Legislation and Comparative Law under the Government of Russia.
Source: http://mcx.ru