Agriculture Minister: By 2021 the system of agricultural insurance will work in Armenia

ArmInfo. In the sphere of agriculture in Armenia, by 2021 the system of agricultural insurance will be fully implemented. This was reported by the Minister of Agriculture of Armenia Ignaty Arakelyan on October 11 at a meeting with journalists.

The minister recalled that in order to ensure protection from natural and climate surprises and the development of an adequate system for reimbursement of damages caused, an agreement was signed earlier with the German development bank KfW, within which it is planned to launch a pilot program for insurance of agricultural risks. For the first time, it is possible to insure risks associated with frost and hail.  Based on the results of the development of the necessary legislative framework and during the implementation of the pilot project, after 3 years the system will be fully implemented. "Thus, the agro- sphere will become more protected and insured against possible damages," the head of the Ministry of Agriculture said.

Earlier, ArmInfo informed that starting in 2018 a pilot program of agricultural insurance and installation of anti-hail networks will start in Armenia. "We hope that within 2-3 years the Armenian economy will reach the level necessary for the formation of the appropriate effective demand on the market for the full implementation of programs, otherwise it will be necessary to find mechanisms for the implementation of these programs, since without them it will be impossible to provide a solution tasks of the sphere," Ignaty Arakelyan said on June 15 after the meeting of the government, noting that only in this way it is possible to compensate the villagers for the damage in full.The talk about the fact that the introduction of agricultural insurance has no alternative and can be the only working life-circle for the Armenian farmer responsible for the sphere is exaggerating for more than 10-15 years. The last time the topic was returned in December 2016, when the German Development Bank KfW stated that in order to conduct research in the direction of introducing the institute of agricultural insurance in Armenia will provide 1 million euros. As the Deputy Minister of Agriculture of Armenia Armen Harutyunyan stated then, within 2 years the Armenian side conducted joint work with KfW. The program will focus on insurance of profitable lines of agriculture, he said.

Earlier, KfW allocated 400 thousand EUR for the development of the concept of agricultural insurance for Armenia and Georgia. Interestingly, the results of this work, which KfW entrusted to hold one of the "close" to itself international consulting companies, the participants of the insurance market of Armenia never saw. The Ministry of Agriculture then informed ArmInfo that they are also

unfamiliar with the results of these studies. The KfW office in Yerevan refused to meet with ArmInfo on this issue.

Meanwhile, in November 2015, Executive Director of INGO Armenia Insurance Company Levon Altunyan, now the head of the Ministry of Health, told ArmInfo that agriculture, especially Armenian, has a very unprofitable loss and is caused by several factors. First, it is the concentration of all risks in a small area, and secondly, this exposure to virtually all existing risks - floods, frosts, hail,

landslides. "Agri- insurance, in this case, should be some kind of semi-obligatory nature, so that at least 30-50% of farms are insured, otherwise it is unreasonable," the insurer explained.