At the opening of the conference on "Agricultural insurance in the face of the challenge of climate change", Luis Planas has urged to reflect and discuss the impact of climate change on a key risk management tool, such as agricultural insurance, to guarantee the viability of agricultural, forestry and aquaculture farms.
The main challenge facing the agricultural insurance system is climate change and a higher accident rate is estimated. Although the risks arising from this phenomenon are not new and are already covered by the current system, the degree of uncertainty has increased, since the frequency and intensity with which the damage occurs is expected to increase.
Spain, due to its geographical situation, has a high climatic variability and is especially vulnerable to climate change. Phenomena such as drought or floods, increasingly frequent, will affect the viability of farms.
Agricultural insurance, pillar of Spanish agricultural policy
Agricultural insurance is a pillar of agricultural policy for this country, said the acting minister. Planas also stressed that Spain was a pioneer, more than 40 years ago, in designing an effective risk management tool for sustaining the income of producers and guaranteeing the continuity of farms affected by adverse climatic phenomena.
During the last decade the three years of maximum accident rate have been recorded since the insurance was launched, more than 40 years ago, in reference to 2012, 2017 and 2018.
Years that have shown the effectiveness and solvency of the agricultural insurance system, by giving a quick response to the insured and limiting the economic losses of the farms.
The great climatic variability to which the agricultural sector in Spain is exposed will increase in the future, according to scientific reports, so that the sustainability of the system must be ensured, so that it remains a key instrument to support income from producers in critical moments due to the damage caused to farms due to adverse natural phenomena.
With the increase in accidents, a series of consequences arise that must be addressed with "absolute transparency" by all the actors that make up the agricultural insurance system to ensure its solvency and its own sustainability.
The insured will have to face the adequacy of the premiums; the MAP and the autonomous communities will have to have a greater budget to help producers subscribe for insurance policies; he Insurance Compensation Consortium you will have to have an adequate level of reservations; and insurance companies will have to make the maintenance of their solvency level compatible with the offer of premiums at an affordable price for the insured.
In addition, the State Agricultural Insurance Entity (In that), in coordination with all the members of the system, you will have to redesign insurance lines so that they adapt to the new circumstances, especially those derived from the incidence of climate change.
The minister has trusted that in this first forum of debate, in addition to visualizing the challenges faced by agricultural insurance as a result of climate change, future solutions are envisioned to ensure the sustainability of the system.