Crop and Plantation Insurance

Cotton is a high input and high value crop which often makes up a high proportion of a farm's total revenue. As such it's important to ensure the crop is adequately covered as losses in the field can significantly impact on a grower's profitability.

Crops can be insured for loss of revenue as a direct consequence of hail and fire. The policies provide a variety of additional benefits including:

• Replant subsidy
• Additional expenses following hail or fire
• Loss of refuge crops
• Chemical overspray.

Most policies also offer a range of options including seed cotton insurance covering cotton modules on farm and in transit, quality downgrade and a late harvest crop benefit. Downgrade as a result of rainfall is also available on a limited basis.

Whilst irrigated crop yields tend to be more predictable, dryland crop yields can be highly variable creating their own unique insurance requirements and need to be structured very carefully.

Broadacre crop losses can significantly impact on a grower's profitability. Crops can be insured for loss of revenue as a direct consequence of hail and fire. There are two types of policies, Pre harvest Revision and Post Harvest Declaration. Both policies provide a variety of additional benefits and options including:

• Chemical overspray
• Harvested grain in storage and transit
• Straying livestock
• Fire fighting costs
• Reducing Excess.

The loss of a seasonal crop can impact your profitability and a loss of vines can have a significant long-term impact on the viability of your business.

Cover can be arranged for both vines and crops including:

• Vines can generally be insured for fire, hail, frost and windstorm. Most policies include a variety of additional benefits including replanting and reestablishment costs, fire fighting and mitigation expenses, removal of debris and vineyard infrastructure.
• Table and wine grapes are particularly difficult to insure for hail and frost. Where available the policies would include a variety of additional benefits including harvested fruit, additional expenses, grading penalties and restricted access costs.

The loss of a seasonal crop can impact your profitability and a loss of trees can have a significant long-term impact on the viability of your business.

Where cover is available it can generally be arranged for both fruiting trees and crops including:

• Fruiting trees can generally be insured for fire, hail and windstorm. Most policies include a variety of additional benefits including replanting and reestablishment costs, fire fighting and mitigation expenses, removal of debris and orchard infrastructure.
• Tree crops (including nuts) can generally be insured for hail and fire. Most policies include a variety of additional benefits including harvested fruit and additional expenses.

The plantation insurance market in Australia is extremely limited following the Black Summer 2019/20 season's fire losses. As a consequence, there are very few insurers offering traditional insurance which covers the destruction of trees as a direct consequence of fire, hail, malicious acts, impact and as an option, windstorm.

The policies provide a limited variety of additional benefits including:

• Removal of debris
• Replanting costs
• Fire fighting expenses
• Claims preparation costs.

In addition to the traditional insurance market, we have structured many parametric fire policies which are based on a Burn Ratio Index comparing the NDVI of pre and post fire satellite images. Whilst the Parametric Policy is limited to fire, it is very flexible in terms of how it can be structured to meet the costs of reinstating your plantation following a fire loss all the way through to full Net Present Value cover.

Traditional fire insurance cover for carbon projects is extremely limited especially if the project involves multi species planting in an unmanaged environment or is located outside a traditional plantation region. In these situations, a parametric fire policy is likely to be the only available insurance option. Fortunately, parametric policies are very flexible and can cater not only for the loss of the plantings but also the loss of ACCU's.