Newsletter Issue #9 November 2021


Reaching towards the end
of a successful journey,
we proudly welcome you back
in our penultimate Newsletter!

In this 9th issue we present Insights on agricultural disaster risk management and the second BEACON Business case in Serbia conducted together with the Agricultural Insurance company Triglav. Check out the hottest Upcoming events and the latest on agri-insurance In case you missed out.

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Insights on agricultural disaster risk management

Natural hazard-induced disasters (NHID), including weather phenomena like floods, droughts and severe storms, but also pest infestation and spread of diseases have significant, widespread and long-lasting impacts and can put many farm operations out of business, if not supported by crop insurance programs.  Such phenomena are increasing in appearance and intensity over the last recent years, all over the globe. Agricultural Resilience is now imminent as climate change is accelerating. In a recently published OECD report Insights on Building Agricultural Resilience to Natural Hazard-induced Disasters are presented based on case studies from different Countries. In this article, we have selected three case studies, each in a different continent and their overview is presented in the following.  


Natural hazard-induced disasters, including climate related events, often and highly impact Chile’s agricultural sector. To this end the country has built a national agroclimatic risk information system to monitor, identify, assess and communicate the risks. In addition, capacity development events and trainings are organised to enhance awareness raising among key stakeholders on these agroclimatic information products. Agro-insurance is a key pillar in Disaster Risk Management strategy in the case of Chile. Government subsidies are currently provided by the Chilean Economic Development Agency’s Agricultural Insurance Committee – Agroseguros. In addition, INDAP’s Agricultural Insurance Support Programme (PACSA) is available to assist smallholder and subsistence farmers in purchasing an agriculture insurance policy. PACSA will complement the Agroseguros subsidy up to 95% of the net premium cost unsubsidized by Agroseguros. Combined, MINAGRI and INDAP allocated a total of roughly USD 10.2 million to subsidize agricultural insurance in 2019. While all types of agricultural producers may participate in the programme, smaller and less-resilient farmers benefit the most.


Drought is increasingly becoming a matter of concern for the agricultural sector in Italy, making improved agricultural resilience and water resources management a priority. A number of initiatives have recently been positioned to cope with natural hazards’ risk. Recent initiatives are positioning in Italy for improved resilience to natural hazards. More particularly these initiatives include action is risk awareness raising in the agricultural sector, improved data collection on water resources and agricultural damage and loss from natural hazards by the relevant stakeholders. Additionally, policymakers recognise the advantages of preventive and ex ante approaches, whilst response processes increasingly prioritise business continuity. The OECD report concludes that agricultural resilience could be further strengthened by the development of a holistic, long-term sectoral risk management strategy that would ensure the effectiveness of existing reforms. This reformed strategy should also re-evaluate the trade-offs between spending on risk coping tools versus increasing investments in risk prevention and preparedness through agricultural insurance. The increasing ageing farmers’ population in the country and its relative capacity should also be incorporated in policy design.


The Agricultural sector in Japan is facing significant risks from large-scale typhoons and heavy rain events which are expected to intensify because of climate change. To add on these natural hazard-induced disasters, the sector is also facing risks due to the ageing of the farming population and depopulation in rural areas. Therefore, better management of disaster risks and improved agricultural resilience via crop insurance is vital to support the sector.  To this end, a variety of structural and non-structural measures have been adopted to improve risk prevention and mitigation, as well as to allow the rapid recovery and ex post provision of support that allows business continuity for farmers. Governmental ex post disaster support in some cases is only provided to farmers that have insurance, whilst insurance uptake is higher for field crops and cattle. The report states that government-led disaster risk reduction efforts require a greater effort by stakeholders that can be encouraged by clarifying farmers’ responsibilities and incorporating agricultural co-operatives networks into ex ante Disaster risk management activities.

2nd Business Case - Triglav, Serbia

In this issue we are presenting BEACON’s 2nd Business case that represents the Serbian Business Case conducted together with the Agricultural Insurance company Triglav. Triblav Osiguranje is a part of the Adria region – Triglav Group, one of the leading insurance groups in SouthEast Europe. Triglav Osiguranje is a very active insurance company on the Serbian market (among the 5 biggest insurance companies) and active in provision of agri-insurance services for last couple of years.

BEACON services were tested in this case focusing on the insurance against hail as 90% of damages in Serbia are caused by this weather event. This business case was implemented in the frames of approving crop damages caused by hail and validated the accuracy of the BEACON Damage Assessment calculator component. TRIGLAV provided crop damages originated from Vojvodina the Serbian flatland. Vojvodina is a region located in the northern part of Serbia and has the best quality of herbal land in the whole of Serbia with high standards of yield.

The three most dominant crop types in the region are maize, wheat and soya bean. Therefore, Triglav provided input on hail damages mostly related to these crops. The damage severity caused by hail in the samples ranged between less than 5% and 100%, for the three selected crops for parcels that were insured during the growing season of 2015-20106 to the growing season of 2019-2020.

The general framework under which the Damage Assessment Calculator estimates hail damage on insured parcels, is the implementation of a change detection index. The DPI (Difference Percentage Index) serves as a measure and can be applied on any vegetation index or canopy biophysical paramater of choice, to detect significant change index or canopy biophysical parameter of choice, to detect significant change between pre- and post-hazard crop status. Optical satellite data was used for the calculation of NDVI, GNDVI, MCARI, REIP vegetation indices (with 10m spatial resolution) and the biophysical parameters Leaf Area Index, FCOVER and FAPAR (with 20m spatial resolution). The indices were then used to calculate the DPI index per applying Equation.

In the Damage Assessment Calculator of BEACON, the MPDI was calculated and tested in change detection. Other SAR derived indices tested in the DPI, were the PRI (Polarization Ratio Index), which is the VH/VV ratio, as well as the VH and the VV backscatter signals. To tackle the irregularity in pre- and post-damage image acquisition dates due to cloud cover, the pre-event and post event sampled images were created, corresponding to the Vegetation Index feature of 6days before the event and 20days after the hail event.

The logic behind the machine learning approach tested in BEACON, is described and illustrated in the following workflow for damage classification. Firstly, the insurer imports the date of the hail event. Then, the pre-event composite image is produced by the 36-day pre-event image stack by the temporal interpolation tool. Also, the post-event composite image is produced by the 45-day post-event image stack by the temporal interpolation tool. The Difference Percentage Index is produced by the pre- and post-damage composite image.  The zonal statistics are extracted across the parcel (zonal minimum, maximum and average). The machine learning model takes into account the crop features such as growth stage and parcel-based Difference Percentage Index to predict and classify the damage. In the end the output is damage classification (0-10, 10-30, 30-70 and 70-100%) or a single damage percentage.

Upcoming events

ICARMCI 2022: 16. International Conference on Agricultural Risk Management and Crop Insurance

  January 28-29, 2022

The Agricultural Risk Management and Crop Insurance Conference will be held online on January 28-29, 2022. This conference aims to bring together leading academic scientists, researchers and research scholars to exchange and share their experiences and research results on all aspects of Agricultural Risk Management and Crop Insurance. It also provides a premier interdisciplinary platform for researchers, practitioners, and educators to present and discuss the most recent innovations, as well as practical challenges encountered, and solutions adopted in Agricultural Risk Management.

IRMI AgriCon 2022

  March 7–8, 2022
  VSacramento or Online

IRMI AgriCon is the premier event for insurance and risk management professionals who specialize in the unique exposures and nuanced coverage needs of farms and agribusinesses. The IRMI Agribusiness Conference will be run hybrid on March 7-8, 2022, offering a forum where agents, brokers, underwriters, and insurance buyers can gain the expertise they need to properly insure the unique exposures of farms and agribusinesses while networking and sharing best practice ideas with peers in the industry.


  April 13-14, 2022

Paris Blockchain Week Summit will be held on April 13-14, 2022, in a hybrid event. As the flagship event of Paris Blockchain Week, and under the joint High Patronage of the French Ministry for the Economy and Finance and the Secretary of State for Digital Affairs, insightful talks are going to take place, from the best entrepreneurs, developers and visionaries around the hottest topics in 4 Tracks: Tech Builders, Open Finance, Enterprise Blockchain and Public Policy. The Summit is open for registrations and more information will follow soon.

IEEE International Conference on Blockchain and Cryptocurrency

  May 2–5, 2022
  Shanghai, China

ICBC 2022 is the fourth instalment of the IEEE Communications Society (ComSoc) sponsored conference on Blockchain and Cryptocurrency. It will be held in Sanghai, China on May 2-5, 2022 and it will feature keynotes, peer-reviewed technical paper presentations, posters, demos, a hackathon, and exhibitions from world-leading service providers, solution vendors, research institutes, and open-source projects. ICBC 2022 will also offer the possibility for the technical exchange of the latest research and innovation, policies, standards, and applications in blockchain and cryptocurrency.

In case you missed

Global reinsurer enters the agricultural market

The global reinsurer company MS Amlin AG (MS AAG) has recently entered the agriculture reinsurance market by appointing Rinat Bektleuov as product group lead underwriter. MS AAG took this step as part of its wider global diversification strategy. The agriculture reinsurance offering will include crop insurance, livestock insurance, aquacultural insurance, forestry, and weather index products. Read more…

India to set up a consolidated fund for compensations

The Agriculture Minister of India Mr. Prasad announced the establishment of a consolidated fund for disbursing compensation to farmers for crop loss. The impacts of climate change are becoming apparent and natural calamities have become frequent, endangering agricultural production and economy. The rainfall-related incidents between October 12 and October 28 resulted in damage of ₹451.65 crores (over 5million Euro). A consolidated fund will go a long way in ensuring speedy calamity relief to farmers, Mr. Prasad said, and the fund will be instituted in consultation with the Finance Department. Read more…

New insurance option for US conservation-minded farmers

The U.S. Department of Agriculture (USDA) announced that corn farmers who “split apply” nitrogen – that is make multiple fertilizer applications over the growing season rather than single nitrogen fertilisation - will soon have another option for insurance coverage. Beginning in the crop year 2022, the Risk Management Agency (RMA) will offer the Post Application Coverage Endorsement (PACE) in certain states for non-irrigated corn, providing coverage for producers who use this practice that is considered better for natural resources and saves money for producers. Read more…

Crop losses expected to impact underwriting profits

KBW analysts are warning that crop losses will likely weigh on insurers’ overall underwriting profits for 2021. KBW notes that although US crop underwriting losses should pale relative to the larger catastrophe losses in Q3, it was actually the third-highest Q3 average for crop losses since 2000. This is expected to have significant implications for insurer profits. The company also estimates that Q3 drought conditions correlate positively with direct full-year crop combined ratios. Read more…

The new Micro Farm policy

USDA’s Risk Management Agency has created the new “Micro Farm policy” that simplifies record keeping and covers post-production costs. The Micro Farm policy is available to producers who have a farm operation that earns an average allowable revenue of $100,000 or less, or for carryover insureds that earn an average allowable revenue of $125,000 or less. RMA’s research showed that 85% of producers who sell locally reported they made less than $75,000 in gross sales. The policy will be available starting from the 2022 crop year. Read more…

New OECD report on Climate Risks

OECD has just published a report that addresses the urgent issue of climate-related losses and damages. The report approaches climate-related losses and damages from a risk management perspective. It explores approaches to reduce and manage risks with a focus on policy action, finance and the role of technology in supporting effective risk governance processes. Drawing on experiences from around the world, least developed countries and small island developing states in particular, the report highlights a number of good practices and points to ways forward. Read more…

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