ArmInfo.The introduction of agricultural insurance in Armenia will definitely have a positive impact on the dynamics of agricultural lending by banks. This opinion was expressed on October 30 during a press conference by the chairman of the Union of Banks of Armenia, chairman of the IDBank Board Mher Abrahamyan, answering a question from ArmInfo.
"I think that with the introduction of the agricultural risk insurance system, banks will more readily begin to finance agricultural entities, because the risks associated with the borrower will decrease," he stressed. To note, a pilot project for agricultural risk insurance was launched in Armenia. At the first stage, insurance covers apricot orchards and vineyards, and hail, fires and spring frosts are defined as the risks covered by insurance. Farms from Armavir, Ararat, Aragatsotn, Tavush, Kotayk and Vayots Dzor regions will be insured against hail and fires, and farmers from Armavir and Ararat will be able to insure against spring frosts. In addition, farmers will be able to choose one of 5 insurance policies. The amount of the insurance premium will be determined on the basis of a risk assessment on a particular land plot. So far, with any insurance package, 50% of the amount of the insurance premium will be paid by the Armenian government, and with full insurance, that is, simultaneous insurance against all risks - hail, fire and frost, a 10% discount is envisaged. The state within the framework of the agricultural insurance project will subsidize 50% of the cost of the insurance policy (against the previously called 60-65% - Ed.note). The National Agency of Agricultural Insurers (www.aina.am) has been established. So far, the partners of the agency are three companies - Ingo-Armenia, Rosgosstrakh Armenia and Sil Insurance. They specify the internal mechanisms for the further servicing of policies for this class of risks. A major Swiss company SwissRe will reinsure agricultural risks as part of a pilot project. The first insurance contracts are supposed to be concluded in January 2020. On October 24, the Armenian government approved the procedure for subsidizing insurance payments within the framework of the pilot agricultural risk insurance program.