[194 Pages Report] The Agriculture Reinsurance Market size was estimated at USD 17.53 billion in 2023 and expected to reach USD 19.92 billion in 2024, at a CAGR 13.73% to reach USD 43.15 billion by 2030.
Agriculture reinsurance refers to the risk management practice where an insurance business transfers a portion of its agricultural insurance liabilities to a reinsurance company. This transaction helps the primary insurer mitigate the risk of large claims or catastrophic events arising from agricultural uncertainties such as natural disasters, disease outbreaks in livestock, or significant price volatility in agricultural commodities. Reinsurance arrangements in agriculture help insurers stabilize their financial performance, manage their risk exposure, and maintain solvency while offering comprehensive coverage to farmers and agribusinesses. The elevating frequency of extreme weather events is driving demand for reinsurance services. In addition, subsidies and support programs for agriculture insurance make reinsurance more accessible to insurers. However, the multifaceted nature of agricultural risks makes policy design and risk transfer challenging for providers of agriculture reinsurance. In addition, seasonal variations and cyclic prices affect the predictability and stability of the agriculture reinsurance market. Nevertheless, developing advanced models to assess and predict climate-related risks with greater accuracy and creating customized reinsurance products for niche markets within agriculture are expanding the usage of agriculture reinsurance solutions.
Crop price reinsurance is a specialized form of reinsurance designed to protect insurers from losses due to significant drops in agricultural commodity prices. Crop price reinsurance helps ensure farmers receive a guaranteed crop price, regardless of market fluctuations. Farmers who rely heavily on market prices and are susceptible to revenue losses when prices fall would prefer crop price reinsurance. Crop revenue reinsurance protects against a shortfall in revenue from crop production. Crop revenue reinsurance combines price protection with yield protection, offering farmers and insurers a more comprehensive risk management tool. Crop revenue reinsurance coverage is critical for farmers who need to ensure a stable income for planning various financial obligations. Crop yield reinsurance protects against losses caused by low yield due to perils such as drought, flood, pests, or disease. Crop yield reinsurance typically covers a specific quantity of production rather than its value. Crop yield reinsurance is particularly important in regions susceptible to adverse weather conditions or pest infestations that can drastically reduce crop yields.
Aquaculture insurance covers fish farms, shellfish farming, and other aquatic organisms against unexpected losses. Aquaculture insurance is needed to protect investment in stock, equipment, and potential environmental liabilities. Bloodstock insurance is specialized coverage for valuable blooded horses, which is particularly important for horse breeders, racetrack owners, and horse investors. Forestry insurance covers the loss of standing timber due to hazards such as fire, windstorm, insects, and disease. Forestry insurance is necessary for timber companies, private forest landowners, and investors. Greenhouse insurance covers structures and plants against perils, including fire, hail, and mechanical breakdown. Greenhouse insurance is ideal for commercial greenhouse operators and nurseries. Livestock insurance covers animals against death caused by accidents, illness, or disease. Managed crop hail insurance protects against loss of crop yields, specifically from hail damage. Multi-peril crop insurance (MPCI) covers crop losses from natural disasters and revenue losses due to market fluctuations.
Excess-of-loss reinsurance is a non-proportional form of reinsurance where the reinsurer is liable for losses that exceed a specified limit. Excess-of-loss reinsurance is usually utilized when insurance companies seek protection against catastrophic events or unpredictable large losses in the agricultural sector. Facultative coverage is an arrangement where the reinsurer considers and underwrites individual risks offered by the insurer, rather than whole portfolios. Loss-occurring coverage is a reinsurance agreement that covers losses occurring during a specified period, regardless of when the claims are made. Loss-occurring coverage is typically preferred in scenarios where losses from agricultural risks might not be immediately apparent or quantifiable. Non-proportional reinsurance operates independently of the size of the insurers' loss, kicking in when a claim exceeds a predetermined threshold. Proportional reinsurance involves sharing premiums and losses between the insurer and the reinsurer in proportion. Proportional reinsurance allows insurers to write larger policies than they would otherwise be able to handle, making it useful for insurers looking to grow or stabilize premium volumes while managing risk in the agriculture sector. A reinsurance treaty is a formal agreement between an insurer and reinsurer to cover a specified category or portfolio of business, typically for a period of one year. Agricultural insurers may prefer treaties to systematically manage exposures across a range of products or regions. Risk-attaching reinsurance provides coverage for policies commencing within the period specified in the reinsurance contract, and it is best suited for insurers who require guaranteed ongoing coverage for new policies they underwrite.
The Asia Pacific agricultural sector is characterized by a high reliance on agriculture with a strong need for insurance products tailored to small-scale farmers, who require protection against crop failures due to extreme weather events. The significant investments in agritech startups and smart farming solutions across the region have propelled the demand for agriculture reinsurance in the Asia-Pacific. Numerous public-private partnership initiatives are underway in the Asia-Pacific to enhance crop insurance penetration and farmer financial literacy programs. The Americas represents a highly developing agricultural reinsurance market with strong risk management practices and reinsurance mechanisms. Farmers in these regions tend to engage well with insurance products, reflecting a maturity in understanding the importance of safeguarding their operations. In addition, government-led crop insurance schemes influence the market dynamics of agriculture reinsurance. The European has a well-established Common Agricultural Policy (CAP) influencing insurance purchasing behavior. In the EU, demand for sophisticated insurance products that accommodate various agricultural practices and compliance with environmental standards is growing due to increased consumer awareness and adoption of insurance solutions. The ongoing investments by the vendors and supportive government initiatives for the agricultural sector are expected to enhance the availability of agriculture reinsurance in the EMEA region.
The FPNV Positioning Matrix is pivotal in evaluating the Agriculture Reinsurance Market. It offers a comprehensive assessment of vendors, examining key metrics related to Business Strategy and Product Satisfaction. This in-depth analysis empowers users to make well-informed decisions aligned with their requirements. Based on the evaluation, the vendors are then categorized into four distinct quadrants representing varying levels of success: Forefront (F), Pathfinder (P), Niche (N), or Vital (V).
The Market Share Analysis is a comprehensive tool that provides an insightful and in-depth examination of the current state of vendors in the Agriculture Reinsurance Market. By meticulously comparing and analyzing vendor contributions in terms of overall revenue, customer base, and other key metrics, we can offer companies a greater understanding of their performance and the challenges they face when competing for market share. Additionally, this analysis provides valuable insights into the competitive nature of the sector, including factors such as accumulation, fragmentation dominance, and amalgamation traits observed over the base year period studied. With this expanded level of detail, vendors can make more informed decisions and devise effective strategies to gain a competitive edge in the market.
One Acre Fund Launches Reinsurance Scheme to Safeguard Smallholders Impacted by Climate Crisis
One Acre Fund established One Acre Fund Re – a reinsurance fund set to debut in 2024. This fund is the product of strategic collaborations with major financial institutions like the International Finance Corporation, US International Development Finance Corporation, and African Risk Capacity to insure over one million farmers. One Acre Fund Re aims to capitalize on the organization's extensive field presence and sophisticated data analytics, offering insurance products intricately tailored to the lived reality of the farmers. [Published On: 2023-12-06]
Lexasure’s InsurTech and AgriG8’s FinTech Merge Forces
The Lexasure Financial Group Limited and AgriG8 announced a memorandum of understanding to enhance the financial ecosystem for rice farmers in Indonesia. This collaboration aims to merge AgriG8's agricultural fintech capabilities with Lexasure's innovative reinsurance and InsurTech solutions, providing a broad array of services including credit, crop insurance, and agricultural advisement through an intuitive mobile platform. [Published On: 2023-05-30]
Rokstone Announces USD 25 Million Allianz-backed Partnership
Rokstone, the international insurance and reinsurance MGA under Aventum Group, fortified its presence in the North American market through a significant alliance with Allianz Commercial. This partnership is highlighted by Allianz committing a robust USD 25 million facility to support Rokstone's expansion within North American Marine operations. [Published On: 2023-01-09]
The report delves into recent significant developments in the Agriculture Reinsurance Market, highlighting leading vendors and their innovative profiles. These include African Reinsurance Corporation, Agritask, AIR Worldwide Corporation, Allianz Group, American Agricultural Insurance Company, Aon PLC, Arch Capital Group Ltd., AXA Group, AXIS Capital Group, Berkshire Hathaway Inc., Canopius Managing Agents Limited, Continental Reinsurance Plc, Core Specialty Insurance Holdings, Inc., Everest Re Group Ltd., Gallagher Re, Guy Carpenter & Company, LLC, Hannover Re Group, MS Amlin AG, Munich Re, PartnerRe Ltd., QBE Insurance Group Limited, R+V Versicherung AG, Scor SE, Sompo Holdings, Inc., and Swiss Re.
This research report categorizes the Agriculture Reinsurance Market to forecast the revenues and analyze trends in each of the following sub-markets:
- Crop Insurance Type
- Crop Price Reinsurance
- Crop Revenue Reinsurance
- Crop Yield Reinsurance
- Product
- Aquaculture Insurance
- Bloodstock Insurance
- Forestry Insurance
- Greenhouse Insurance
- Livestock Insurance
- Managed Crop Hail Insurance
- Multi-Peril Crop Insurance
- Type
- Excess-of-Loss Reinsurance
- Facultative Coverage
- Loss-occurring Coverage
- Non-proportional Reinsurance
- Proportional Reinsurance
- Reinsurance Treaty
- Risk-Attaching Reinsurance
- Region
- Americas
- Argentina
- Brazil
- Canada
- Mexico
- United States
- California
- Florida
- Illinois
- New York
- Ohio
- Pennsylvania
- Texas
- Asia-Pacific
- Australia
- China
- India
- Indonesia
- Japan
- Malaysia
- Philippines
- Singapore
- South Korea
- Taiwan
- Thailand
- Vietnam
- Europe, Middle East & Africa
- Denmark
- Egypt
- Finland
- France
- Germany
- Israel
- Italy
- Netherlands
- Nigeria
- Norway
- Poland
- Qatar
- Russia
- Saudi Arabia
- South Africa
- Spain
- Sweden
- Switzerland
- Turkey
- United Arab Emirates
- United Kingdom
- Americas
- Market Penetration: It presents comprehensive information on the market provided by key players.
- Market Development: It delves deep into lucrative emerging markets and analyzes the penetration across mature market segments.
- Market Diversification: It provides detailed information on new product launches, untapped geographic regions, recent developments, and investments.
- Competitive Assessment & Intelligence: It conducts an exhaustive assessment of market shares, strategies, products, certifications, regulatory approvals, patent landscape, and manufacturing capabilities of the leading players.
- Product Development & Innovation: It offers intelligent insights on future technologies, R&D activities, and breakthrough product developments.
- What is the market size and forecast of the Agriculture Reinsurance Market?
- Which products, segments, applications, and areas should one consider investing in over the forecast period in the Agriculture Reinsurance Market?
- What are the technology trends and regulatory frameworks in the Agriculture Reinsurance Market?
- What is the market share of the leading vendors in the Agriculture Reinsurance Market?
- Which modes and strategic moves are suitable for entering the Agriculture Reinsurance Market?
- Preface
- Research Methodology
- Executive Summary
- Market Overview
- Market Insights
- Agriculture Reinsurance Market, by Crop Insurance Type
- Agriculture Reinsurance Market, by Product
- Agriculture Reinsurance Market, by Type
- Americas Agriculture Reinsurance Market
- Asia-Pacific Agriculture Reinsurance Market
- Europe, Middle East & Africa Agriculture Reinsurance Market
- Competitive Landscape
- Competitive Portfolio
- List of Figures [Total: 22]
- List of Tables [Total: 302]
- List of Companies Mentioned [Total: 25]
Agriculture insurance offers coverage to farmers against various risks. However, it has its limitations, which is why agriculture reinsurance is critical. As agriculture is susceptible to a wide range of risks from natural disasters such as droughts, floods and storms, armed conflicts, economic uncertainties, and climate factors, among others. Agriculture reinsurance provides a safety net against such risks, making sure farmers can continue to provide us with the food we need.
In times of natural disasters or similar circumstances that lead to crop losses, reinsurers pay-out claims, helping farmers recover their losses. This way, farmers can continue to produce sufficient food, ensuring food security, even during drastic losses. The reinsurers divide the risks into smaller fractions, underwriting each unique risk and reducing the potential vulnerability that could arise if a single catastrophic loss occurred.
Apart from providing support in times of severe losses, reinsurance agencies also act as a guiding force to farmers. They consult with them on the best strategies for preventing and limiting damage to crops and livestock. This risk reduction strategy is productive both for the farmers and the reinsurers, as it helps to keep insurable losses minimal and manageable.
Insuring crops and livestock on a large scale is critical to the agricultural sector, especially in developing economies, where farmers are left vulnerable to the risks of crop and livestock damage. With the help of reinsurance, farmers gain confidence, enabling them to invest in their farming activities and in turn, stimulate the economic growth of their regions.
Agricultural reinsurance is vital for securing a reliable food supply and providing support to farmers during catastrophic events. It helps farmers manage the unpredictable nature of agriculture by providing a safety net for the risks involved in the industry. The industry needs proper insurance support to thrive and progress. By understanding a robust agriculture reinsurance plan, we can ensure sustainable food production globally. Ultimately, we should all appreciate the importance of this type of insurance, as it not only supports the agricultural industry but also provides us with a consistent food supply.
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