Estimates so far from Prairie farmers’ hail claims for 2007 come in at $208 million, just short of the $211 million collected in premiums, according to a hail insurers’ group.
The Canadian Crop Hail Association said Friday in the last of its bimonthly reports for 2007 that “considerably more” cash will be paid out in Alberta and Manitoba than was collected in premiums.
In Saskatchewan, meanwhile, payouts total about 87 per cent of premiums paid, but the insurers said the premiums won’t cover costs of adjusting damaged crops or administration of claims.
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Average payments per claim were also well above the longer-term averages in all three provinces, the group noted.
Thanks in particular to three major hailstorms in July, Alberta farmers filed just over 4,700 hail claims, their highest total ever, the group reported. Albertans paid $47.4 million in premiums and the group estimates a total claim payout of $60 million, barring any more storms between now and October 30 when coverage ends for the year at AFSC, the province’s largest hail insurer.
Just under 5,000 claims were filed in Manitoba, close to the record claim year in 2000, the group said. Farmers have put $31 million in premiums toward an estimated $33 million in claim payouts. The largest single event in terms of losses and claims generated was the August 9 storm in the northwestern part of Manitoba’s farm belt.
Saskatchewan farmers, especially in central areas from Kindersley east to Yorkton, filed about 14,000 claims, down from 2006 but still above the five-year average. Farmers paid $132.5 million in premiums toward $115 million in expected claim payouts. Three major storms hit the province in July, the group noted.
The association stressed that its total numbers are cumulative and the loss:payout ratio will vary per company, depending where it does most of its business. It also stressed that while many members will post a loss for 2007, hail insurance is a long-term proposition, so premiums must balance payouts and other costs over a number of years.
