ArmInfo. After two years of inactivity, agricultural insurance in Armenia has finally picked up since 2026. According to the National Agricultural Insurers Agency (AINA), 3,626 contracts were concluded in the first quarter of 2026, with total insurance premiums amounting to 705.5 million drams ($1.9 million), of which 55% (387.7 million drams) was the share of insurance companies, and 45% (317.9 million drams) was subsidized.
The total area of insured land is 3,775 hectares. The dominant insurance premium volume (687.7 million drams, including 380.4 million drams for the insurance company's share and 307.3 million for the subsidized amount) and the number of contracts (3,396) are for agricultural crops such as apricots, grapes, peaches, plums, and grains. The main risks are spring frosts, drought, hail, and fire. The largest area of insured land is used for apricots and grain crops 1,590 hectares and 1,421 hectares, respectively.
It is worth recalling that the agricultural risk insurance program was launched in Armenia in pilot mode in September 2019, and policy sales began in 2020. The partners in this program were the major Swiss reinsurance company Swiss Re and the German bank KfW (subsidized jointly with the RA government on a 50:50 basis - pari passu). Moreover, of the EUR 5.3 million allocated by KfW for agricultural insurance, EUR 2.6 million has already been transferred as subsidies until 2025. This program was in effect until issues with inadequate oversight of compensation payments, which exceeded the estimated damage amount, were identified in 2024. That same year, Swiss Re, a reinsurer, withdrew from the Armenian agricultural insurance market, and insurance companies were unable to fully shoulder the insurance risks, given the high losses caused by climate change. Since then, agricultural insurance has been stalling, and premiums have plummeted. While in 2023, insurance companies concluded 10,192 contracts and wrote 1.8 billion drams in insurance premiums, by 2024, only 27 contracts remained, and premiums had plummeted to 22 million drams. It was precisely because of the high loss ratio recorded in 2023 (with premiums of 1.8 billion drams, compensation amounted to 2.7 billion drams) that Swiss Re, a reinsurance company, left the Armenian market in 2024, and its functions were assumed by the Armenian government in order to reduce the risks of insurance companies.
According to ArmInfo analysts, the government's attempts to revive agricultural insurance, in addition to raising the subsidy threshold from 50-60% to 70-80% in 2025 (if damages exceeded 200%, insurance companies were entitled to compensation for this portion as well), and by also assuming the "reinsurance function," have finally culminated in the program's resumption in 2026. Furthermore, as of 2025, due to program changes, all agricultural crops (apricots, grapes, peaches, plums, apples, cherries, watermelons, melons, potatoes, and grain crops (wheat/barley/oats) are now covered by insurance against all types of risks without limitations (hail and fire, spring frosts and drought). Unlike previous years, when only three insurance companies (INGO, LIGA Insurance, and Sil Insurance) participated in the program, all seven insurance companies are now involved. The government plans for 2026 to find a foreign reinsurance company to partner with this program, and negotiations are underway.
However, according to ArmInfo analysts, the 200 million drams allocated for agricultural insurance in the 2026 state budget are unlikely to allow the Armenian government to fully fulfill its obligations. This is particularly concerning given that global climate change is irreversible, and insurance companies, as previous years have shown, are unable to cover agricultural risks without robust reinsurance. Meanwhile, the World Bank has recommended systemic changes aimed at introducing an insurance component and launching a new, reformed program in 2027.
