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Agricultural Insurance

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AGRICULTURAL INSURANCE. The risks against which farmers have to provide are those incurred in growing, harvesting and storing crops; animal diseases; condemnation of carcases in slaughter-houses; and those risks commonly covered by ordinary life, accident and property insurance. The nature of the risks to which farming is exposed vary between one country and another according to its situation and climate. Thus losses from wind-storms are more common in North America than in many countries of Europe (it has been stated that between 1916 and tornadoes occurred in the United States—an aver age of 94 annually) ; in Great Britain animal diseases, and in Scandinavia forest fires, are more important risks, while in Canada damage by hail causes heavy losses to farmers.

Insurance against these risks may be carried out either through ordinary joint-stock insurance companies, or through farmers' mutual insurance societies. Both methods are used, but the latter is held to have certain advantages. Local mutual insurance societies operating in a small area frequently cover the risk by re-insurance.

In Great Britain there is very little co-operative insurance. A number of joint-stock companies specialize in livestock insurance in addition to covering ordinary accident and fire risks. There appears, however, to be little inclination on the part of British farmers to take advantage of these facilities except in the case of pedigree cattle and other valuable stock. The number of registered mutual insurance societies has declined since 1913, but several unregistered cow and pig clubs exist for the insurance of their members' livestock. Under the Diseases of Animals Act compensation is payable by the State in case of animals slaugh tered in consequence of foot and mouth disease, swine fever, and other diseases. In other countries agricultural insurance has made considerably more progress.

The insurance of crops after harvest is a relatively simple matter, and the risk (mainly a fire risk) is often covered by ordinary joint-stock insurance companies. The insurance of grow ing crops is a more specialized business. Under this head the most successful development is insurance against damage by hail. In the United States, 43 joint-stock fire insurance companies, 41 mutual companies and four State insurance departments carried hail risks estimated in 1919 at $560,000,000. Since 1919 the amount of hail insurance written in the United States has declined. Total premiums received on hail insurance, which in 1919 amounted to $28,000,000, had dropped by 1923 to $18,000,000. In Canada, the Hail Insurance District of Alberta was formed under the Municipal Hail Insurance act of 1918, having in 1919 67 municipal districts. Hail taxes are paid by ratepayers to the municipal districts which in turn pay to the municipal board. The total risk borne by the Hail Insurance Board for the four years 1919-22 amounted to $72,000,000. In Saskatchewan the Municipal Hail Insurance Association carried an insurance of about $25,000,000 in 1921 and 1922.

Hail Insurance in Europe has been developed to a less degree, but organizations to cover this risk are to be found in Germany, Austria, Denmark, Switzerland, France, Spain, Italy and else where. In France 29 mutual societies existed for this purpose in 1921, and Italy had 51 societies in 1922. Some progress has been made, particularly in the United States, in the provision of frost insurance.

Farmers in aggregate have large sums invested in livestock which is liable to suffer loss by disease and other causes. Insur ance against these risks through mutual insurance societies or otherwise has made greater progress in certain European coun tries than elsewhere, although the United States has some 3o mutual livestock insurance companies. France provides perhaps the leading example of European livestock insurance; its develop ment has depended partly on state subsidies. Out of the 14,896 subsidised co-operative insurance and re-insurance societies in France in 1921, over io,000 were societies for the livestock insur ance, and 78 for re-insurance.

Co-operative insurance in Germany has not made progress com parable with that of other forms of agricultural co-operation. Only a small fraction of the livestock in the 'country is covered by insurance. In certain States, notably Baden and Bavaria, cattle insurance has received State assistance. Insurance of carcases against condemnation by the sanitary authorities has also been adopted on a small scale.

Fire insurance is almost universally undertaken by the ordi nary joint-stock companies but in some countries, notably the United States, it has also been largely developed on a co-operative basis. Indeed mutual fire insurance is one of the most successful as well as the oldest co-operative services which have grown up in that country, where, in 1926, there were about 2,000 farmers' mutual fire insurance companies carrying risks amounting to over $io,000,000,000. At the close of 1926 well over half of the total farm property of the United States insurable against fire was insured in farmers' mutual companies.

See International Review of Agricultural Economics. (R. E.)

hail, mutual, companies, risks and societies