Agri-insurance business in the light of COVID 19
According to the Copernicus Climate Change Service (C3S), the first signs of drought started in Eastern Europe in early spring 2020 covering the whole continent with dryer weather than average in April and May. In other words, before the emergence of the COVID-19 pandemic, European farmers were already facing the 3rd drought in a row since the summer of 2018. While climate change represents the persistent threat to agriculture, the pandemic situation affected the agribusiness (and other industries as well) almost overnight. The analysis of the impact on agriculture is currently preliminary. Still, the prevalence of COVID-19 will certainly have broad implications across the sector.
Focusing only on agriinsurance industry, the sector has started experiencing many difficulties operating the regular work during the pandemic situation such as: underwriting of new plots, contract handling and damage estimation. To keep in business, agri-insurance companies have implemented many new procedures and protocols or have changed the way they conduct insurance during this challenging period.
However, even with the pandemic, the agri-insurance industry experiences the expansion and productivity thanks to novel technology and recent developments. Namely, many insurance companies have introduced some technological innovations such as the utilization of drones or satellite remote sensing to assist main agri-insurance procedures. Based on such example, other insurance companies are looking towards the same direction or looking across agri-tech solutions market.
As a result, it can be expected that the conservative agri-insurance industry stakeholders will experience the technological transformation to some extent.