The agricultural insurance coverage rate in Taiwan has increased year by year from 5.79% in 2017 to 51.58% in June this year, according to statistics from the Agricultural and Financial Services Administration.
One reason is the introduction of new agricultural insurance products. For instance, the agricultural insurance segment in Taiwan has introduced new parametric insurance policies for pomelo, jujube and Java apple and a policy for banana losses since a series of typhoons hit the island this year, reported Economic Daily.
In recent years, the government has also stepped up the promotion of agricultural insurance, and non-life insurance companies have launched various agricultural insurance policies.
As of the end of September 2023, the property and casualty insurance market had developed 27 products and 43 policies, since the government expanded the promotion of agricultural insurance in 2017.
At present, agricultural insurance policies are divided into five categories, namely:
1. Actual loss and compensation: represented by pear, banana and agricultural insurance. After an insured event occurs, the insurer must go to the site to assess the loss.
2. Policy-linked: represented by insurance for Chinese pears. When the damage reaches the threshold for government cash assistance, the claim amount can be obtained without the need for damage investigation.
3. Meteorological parametric, represented by aquaculture, red bean and watermelon insurance. When the meteorological data (typhoon wind speed, precipitation, temperature) reaches certain conditions, claims will be initiated.
4. Regional harvest: when the actual harvest volume is lower than the guaranteed harvest volume, a claim will be settled.
5. Income protection: an income protection policy to cover unstable income caused by natural disasters or market factors. Claims will be settled based on the portion of the income that is lower than the base income.
Fubon Property Insurance launched Taiwan’s first commercial crop insurance in 2015 which was Chinese pear crop insurance.
