Like so many industries, insurance is no stranger to the disruption that technology is creating. As AgTech advances, so do the insurance products that mitigate risks for the country’s farmers. There is one insurer that sees the value in the data that AgTech is producing, creating leading edge crop insurance products for Canadian farmers. Global Ag Risk Solutions offers multi-peril Production Cost Insurance today, and soon offer another first-of-its-kind insurance product for canola farmers to protect against heat blast. Also, did we mention this insurance innovator is based in Moose Jaw?
Tailored to the Operation
Until now, farm financial statements or historical yield averages were the standard used to determine insurance coverage in agriculture, which is not always an accurate measure of a farm’s potential productivity. Global Ag Risk Solutions saw an opportunity to use the growing set of data coming from AgTech to determine productive capacity and has not looked back since. “We use data from a farmer’s fields to predict the potential productivity for any given year accounting for factors including agronomy, marketing, and other benchmarks,” says Grant Kosior, Global Ag Risk Solutions president and CEO. “This is a direct benefit to the producer, because we know the risks and inputs and can offer a product that increases liquidity.” For example, on a 5,000-acre farm, the impact of an additional $25 of gross margin every year for five years is significant. In this scenario, producers can up their inputs with confidence (and market more aggressively) and increase their working capital by over 40 per cent.
The company will also offer a new product for canola farmers this year, covering potential losses from heat blast. Global Ag Risk has noted the growing extremes in weather due to climate change and built a product for farmers needing protection. “The length of the canola bloom period determines the yield of the crop,” says Kosior. “If it’s too hot in the flowering season, the yield is reduced. With our product, we cover losses if the weather is too hot during that critical period.” Global Ag Risk measures excess heat blast units using some of the worlds most advanced satellite and radar technologies which creates highly accurate daily measurements in six-mile square grids. This data-driven concept creates transparency, accuracy, and fast claims processes for farmers.
Global Ag Risk also offered the first insurance product in the market that increases its coverage as the producer spends more on inputs. “Our product transfers the risk of inputs from the producer to the insurer,” says Kosior. “We recognize that the more spent on inputs, the greater return in bushels.” More bushels are a benefit to every player in the agriculture industry, from fertilizer companies to implement manufacturers, ag lenders to grocery stores. “Higher gross margins are central to growth in agriculture, and we’re here to grow those margins,” says Kosior. “Regular users of Production Cost Insurance increase their input usage, knowing they can’t lose that money and see consequent increases in the gross margins of $40 per acre or more as a result.”
2021 will also means more innovative insurance products making their debut, including those that will mitigate risk around frost in spring and fall, and expanding the portfolio to add crop types and geographical markets being covered. Global Ag Risk was also successful in working with public insurance programs, where their products can now work together with federal and provincial insurance offerings. “This has dropped costs by 55 per cent to producers,” says Kosior. “This means our cutting-edge products are affordable.”
Take a Look
As producers understand the power of margin insurance, farming practices change. This results in significantly higher gross margins which are the North Star for agriculture. “Our products are designed to fit hand-in-glove with public insurers,” says Kosior. “With Global Ag Risk Solutions, you’re getting better protection that creates a better bottom line for agriculture operations. Our technology brings value that other products can’t provide.”