Cabinet endorses bill on agricultural insurance in Ukraine

Ukraine's Ministry for Development of Economy, Trade and Agriculture says the Cabinet of Ministers has endorsed a bill to introduce a new tool to prop up farmers, namely through agricultural insurance.

That is according to a statement published by the ministry's press service on its website on February 17.

Read alsoEconomy ministry forecasts 20.5% decline in grain exports in MY 2020/21The draft law was developed by the Economy Ministry in cooperation with the National Bank of Ukraine (NBU), agricultural and insurance market players, representatives of relevant associations, and international experts.

"State support through agricultural insurance is an effective tool in many countries. We understand how important and long-awaited this support is for Ukrainian farmers, especially when we talk about global climate change and predictable weather conditions such as drought. This decision will contribute to the development of not only the agricultural sector, but also of the economy as a whole," press service quoted Ukrainian Minister for Development of Economy, Trade and Agriculture Ihor Petrashko as saying.

The bill, which shall be tabled in parliament for voting, defines a mechanism for state support, agricultural products that may be insured, as well as risks and conditions for providing such type of insurance.

Also, the document will repeal the provision on insuring agricultural products via the Agrarian Insurance Pool, which had proved to be unsatisfactory.

Insurance of natural disasters in agriculture

• In 2017, the then Ministry of Agrarian Policy and Food planned to develop a mechanism to insure farmers against natural disasters. However, this has not been done so far. A program for providing state support for the agro-industrial complex in 2019 and 2020 failed to include such a provision.
• According to the Agrarian Union of Ukraine, Ukrainian farmers may post about UAH 118 billion (US$4.2 billion) in losses over droughts and frosts in 2020.