Alberta crop insurance premiums spiking in 2023

A stock photo of a crop. (Pexels/Cristian Manieri)

Farmers and producers in Alberta will have to pay more for crop insurance this year.

The province included a 60 per cent increase in premiums in last week's 2023 budget announcement.  

However, the UCP says it actually works out to an average increase of just over 20 per cent.

"The 60 per cent increase referenced in Alberta’s Fiscal Plan relates to the 2022 budgeted premium compared to the 2023 budgeted premium, and not actual premiums," explains a document on the government's website.

"Budgeted rates are estimates, prepared months before prices and premium rates are finalized. This year’s increase in premiums is actually an average of 22 per cent over what producers paid in 2022."

The 22 per cent premium increase isn’t ideal for farmers, but it’s an expense more and more can’t live without.

"If you weren't very financially sound, if you had no crop insurance the last six years, I don't think you're in business. I don't think you could handle those kind of losses," said farmer Stephen Vandervalk, who’s been on crop insurance five of the last six years.

Several tough growing seasons in a row have led to more and more farmers accessing crop insurance; last year alone there was a nine per cent increase.

Minister of Agriculture of Irrigation Nate Horner says he understands there is frustration over an increase in premiums, but they have to increase alongside higher commodity prices.

"There's nothing political about the formula, there's no subjective political levers in the formula. It's the same formula that's been there for many years. So as commodity prices go up and down it's pretty well reflected in a parallel way to the premium," he said.

According to a statement on the government's website, the 2023 crop insurance premium increase is mainly due to higher crop prices, more producers participating in the insurance program and impacts from the 2021 drought.

The province's most recent budget did include an additional $61.4 million for Agriculture Financial Services Corporation insurance programs have "appropriate funding to support producers during challenging times."

For more information, you can visit the government's website.