AGRICULTURAL INSURANCE IN ITALY

1. AGRICULTURAL INSURANCE IN ITALY HEAD OFF LEGISLATIVE AFFAIRS Paola Grossi

2. risks ATTACK ON BUSINESS SURVIVAL OF FARMERS CREATES MARKET VOLATILITY EU – MEMBER STATES ARE FINDING SOLUTIONS TO TACKLE NATURAL RISKS, MARKET INSTABILITY IN AGRICULTURAL SOLUTIONS

3. MARKET ORIENTETED CAP GLOBALISATION LIBERALISATION EUROPEAN LEGISLATION PERMITS IN ACCORDANCE WITH CERTAIN CONDITIONS AID - EITHER EU OR FROM MEMBER STATES – TO REDUCE CLIMATE RISKS NEW CHALLENGES FOR AGRICULTURAL BUSINESS

4. FARMERS ARE AWARE OF KEY FACTORS QUALITY OF PRODUCE CERTIFICATION PUBLIC HEALTH RELATIONS WITH CONSUMERS REDUCTION IN PUBLIC EXPENDITURE NEED FOR A LEVEL PLAYING FIELD IN TERMS OF PUBLIC AND PRIVATE SUBSIDY

5. AGRICOLTURAL POLICY MUST VALUE QUALITY OF PRODUCE ORIGIN LOCAL LINKS ENSURET HIGHEST INCOMES TO FARMERS AND GIVE THEM ADDED VALUE WHICH CONSUMERS PERCEIVE

6. FARMERS HAVE DEVELOPED MORE SUITABLE STRATEGIES TO REDUCE COSTS INCREASE PRODUCTIVITY INVEST IN THEIR KNOWLEDGE AND TRAINING USE FINANCIAL TECHNIQUES TO MANAGE RISKS

7. FARMERS OFTEN UNDERESTIMATE RISKS THEY THINK OTHER SAFETY NETS EXIST INSURANCE COMPANIES OFFER INSUFFICIENT COVERS

8. AIMS FROM COMPENSATION TO PUBLIC CONTRIBUTION TO COSTS OF PREMIUMS

9. NATIONAL SOLIDARITY FUND IN 2004 STATE AID SYSTEM WAS MODIFIED ACCORDING TO EU REGULATIONS FINANCED BY THE STATE TO A LEVEL PERMITTED BY EU

10. IMPACT ANALYSIS

11. CONSORZI DIFESA FARMERS ASSOCIATIONS AGAINST CLIMATE RISKS THE MAJORITY OF ITALIAN FARMERS ARE MEMBERS OF THESE MUTUAL ORGANISATIONS WHO SIGN CONTRACTS WITH INSURANCE COMPANIES

12. MISSION OF CONDIFESA SIGN CONTRACTS STUDY NEW SOLUTIONS ACCORDING FARMERS’ REQUESTS PARTNERSHIP WITH PUBLIC ADMINISTRATION AND INSURANCE ASSISTANCE WITH MAKING CLAIMS SOLVE ADMINISTRATIVE BURDENS ADVANCE PAYMENTS OF PUBLIC CONTRIBUTIONS

13. SUPPORTFOR THEIR MEMBERS STRONGER BARGAINING POWER WHEN DEALING WITH INSURANCE COMPANIES DIRECT NEGOTIACION WITH INSURANCE COMPANIES SPECIALISED HELP FOR EVALUATING DAMAGES

14. CONDIFESA February – Maysigns contracts on behalf of their members -Then farmers are insured June CONDIFESA assists farmers who are dameged by several climatic events Oct.- Nov.Farmers pay their share of total premium Ex Total premium 100 € Farmers’ share 30% Public subsidy 70%

15. CONDIFESA 1° week of dec. CONDIFESA pays total premium to I.C.. That is – in our ex. – 100 e. Then I.C. pay claims to farmers who are suffered damages Jan. CONDIFESA asks for the contribution for them members (in our ex. 70% of 100 €) Then, when public procedure has finished, CONDIFESA receives the public contirbution.

16. INNOVATION – SOLIDARITY REDUCTION OF COSTS FOR FARMERS BETTER ASSESSEMENT OF DAMAGES TURNS TO ADVANTAGE FOR ALL MARKET PLAYERS OPENING THE MARKET – NEW TYPE OF INSURANCE POLICY FOR THEIR MEMBERS SUCH COVERAGE OF MULTIRISKS PLURIRISKS QUALITY DAMAGE TO FRUIT

17. COLLABORATION WITH PUBLIC ADMINISTRATION INTEGRATED SYSTEM IN A WAY THAT WORKS WELL THE MANAGE AND CONTROL OF STATE AID EFFICIENTLY DISTRIBUTION OF SUBSIDY TRANSPARENCY OF MANAGEMENT: INTERNAL AUDIT WITH PARTICIPATION OF MINISTERIUM AND MUNICIPALITY STATISTICS AND TECNICAL DATA ARE TRANSMIT TO AGRICULTURAL RISKS DATA BANK

18. RELATIONSHIP WITH INSURANCE COMPANIES STUDY INTO NEW TYPES OF POLICY MORE INNOVATIVE AND SUITABLE FOR FARMERS’ NECESSITIES OBSERVATION AND PROPOSALS TO PUT INTO PRACTICE NEW POLICIES STUDY OF MARKET DEVELOPMENT WITH ALL INSURANCE OPERATORS (COMPANIES, BROKERS) AND RESEARCH INSTITUTES (UNIVERSITIES)

19. ISMEA PUBLIC INSTITUTION WHO ADMINISTRATES RISK REINSURANCE FUND “FRR” THAT ENCOURAGES THE INTRODUCTION OF INNOVATIVE POLICIES. The activity of FRR involves directly I.C., that offer innovative coverage,applying two types of reinsurance mechanisms (stop-loss, quota-share) Involves indirectly F., who can benefit from financial advantages of taking out innovative coverage

20. INNOVATION INCOME policy– There isn’t one at the moment MULTIPERILON YIELDS POLICY– COVERS CROP LOSS (QUANTITY PER CULTIVATED SURFACE AND ALSO QUALITY DAMAGES) COMBINEDRISKS POLICY- COVERS DAMAGES TO CROPS AND STRUCTURES (greenhouses, etc.)CAUSED BY SEVERAL NATURAL DISASTERS

21. MULTI PERIL ON YELDS POLICY LOSS OF PRODUCTION Production yield as a reference ALL HERBACEOUS CROPS – FRUIT – TREES – PLANTS SEED MORE COMBINED EVENTS hail,wind,frost,drought,floods REINSURED BY FRR (MAX 90% FIXED FEES 20%)

22. COMBINED RISKS • Herbaceous crops, fruit, greenhouses, trees, seed plants, structures • Two or more defined events: hail, frost, drought,…combined • Damage to production

23. LIVESTOCK POLICY COVERS CATTLE AND BUFFALO FARMS AGAINST MAJORITY OF ANIMAL DISEASES SUCH FOOT AND MOUTH DISEASE – BRUCELLOSIS – TUBERCOLSIS – ENZOOTIC LEUKOSIS - PLEUROPNEUMONIA POLICY COVERS THE VALUE OF THE ANIMAL NOT COMPENSATABLE BY OTHER STATE CONTRIBUTION LACK OF REVENUE FOR THE STOPPAGING PERIOD OF THE PRODUCTION COSTS OF DISPOSING OF DEAD ANIMALS

24. PRIVATE SECTOR FARMERS INSURANCE PUBLIC MINISTERE, REGIONS, ISMEA PUBLIC MINISTRY , REGIONS, ISMEA public private partnership Insurance Technical Committee Insurance Plan Proposal INTERACTIONBETWEEN PUBLIC AND PRIVATE OPERATORS INTERACTIONBETWEEN ALL THE MARKET PLAYERS

25. TECHNICAL COMMITTEE COMPOSITION INSURANCE AND REINSURANCE REPRESENTED FROM ANIA(NATIONAL ASSOCIATION OF I.C.) FARMERS ARE REPRESENTED BY COLDIRETTI AND OTHER PROFESSIONAL BODIES, BY THE COOPERATIVES ASSOCIATION AND BY ASNACODI(ASSOCIATION OF CONSORZI DIFESA)

26. TECHNICAL COMMITTEE FACILITATES RELATIONS BETWEEN INTERESTED PARTIES MAKES PROPOSAL TO THE PUBLIC POWERS REGARDING ANNUAL INSURANCE PLAN

27. NEW SOLUTIONS OBSERVATION OF THE MARKET MAKES FARMERS AWARE OF INNOVATION DIRECT RESEARCH ENCOURAGES COMPETITION TO FARMERS NECESSITIES FIND SOLUTIONS TO DEVELOP CONTRACTS WITHOUT PUBLIC SUPPORT ORGANISED SYSTEM

28. THE COMMITTEE’S WORK IS EQUALY USEFUL TO PUBLIC BODIES TO DEFINE AGRICULTURAL POLICY

29. SUPPLY AND DEMAND ARE MATCHED IN THE COMPETITIVE MARKET INSURANCE COMPANIES FARMERS CONSORZI DIFESA FOR THEIR MEMBERS CAN DRAW UP CONTRACTS FREELY

30. THANK YOU FOR YOUR ATTENTION