Lloyd’s coverholder offers parametric insurance to Spain’s olive farmers
The largest professional agricultural association in Spain will offer parametric insurance for a second year in a row through Lloyd’s coverholder Meteo Protect. The protection is designed to protect its 22,000 olive farmers from the financial consequences of extreme temperatures on their olive fields.
The Agricultural Association of Young Farmers (Asaja) made the announcement following Spain experiencing five heatwaves during the summer of 2017 and farmers in the region bracing for further record temperatures in 2018.
Asaja members access a dedicated weather insurance platform providing fully customized parametric weather insurance designed and managed by Meteo Protect, in order to increase their resiliency against climate-related risks. During the spring months, these include the financial consequences of heat stroke on olives (irrigated and non-irrigated) during the spring flowering period.
“To realize the affordability and necessity of this weather insurance for our members, we can look to the example of an olive farm in the Huesa region of Spain,” said Luis Carlos Valero, spokesperson for Asaja. “With a budget of less than 60 euros per hectare, this subscribed farmer will receive a payment of 1,000 euros per hectare in the event that the temperature exceeds 36 degrees Celsius for more than four days between April 30 through June 15.
“In 2017, record temperatures were reached in Spain on several occasions throughout May and June, in addition to severe drought being experienced at the end of the summer. Thanks to our partnership with Meteo Protect, in 2017, cooperative’s membership who subscribed to parametric insurance for the April through June period and suffered losses had already received compensation by as early as July. Clearly, parametric weather insurance is vital to better protect the livelihoods of our farmers.”
Asaja represents farmers across Spain, which produces 56 percent of the world’s olive oil. Olive trees are very weather susceptible, with thermal and water stress accounting for reduced quality and size of harvests.
Meteo Protects provides Asaja’s membership with customized insurance for any weather-related risk. Farmers select their policy specifications, including geolocation, crop, coverage period, and weather parameters. Parametric weather insurance is designed to compensate the losses incurred through adverse weather conditions. Unlike traditional insurance, indemnification is simple and automatic, requiring no field loss assessment, deductible or adjustment. Meteo Protect’s parametric weather insurance is available for all crops and in all regions.
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