Government unveils $20mn insurance rebate plan

The Federal Government has unveiled plans for an insurance rebate for a fledging insurance product in Australia

Government unveils $20mn insurance rebate plan

Insurance News

By Jordan Lynn

The Australian Government has announced the introduction of a rebate that could be worth up to $2, 500 for farmers on their agricultural insurance.

The rebate, known as the Managing Farm Risk Programme, will see the government use $20 million to fund the initiative across the country and are to be used for “advice and assessments” and “are not for insurance policy premiums,” the Managing Farm Risk Programme website says.

Deputy Prime Minister and minister for agriculture and water resources, Barnaby Joyce, said that the move will help farmers against a range of risks.

"For years Australian farmers have been asking for insurance products to help manage income risks and give peace of mind against pests, droughts and flooding rains and it has taken this Coalition Government to deliver a meaningful incentive," Minister Joyce said.

"This is another result from the Agricultural White Paper, delivering real policy change to complement real delivery in market development."

Minister Joyce said that the rebates will encourage farmers to take up insurance which will help build resilient agricultural businesses across Australia.

"By encouraging farmers to prepare their business for adverse conditions through the use of insurance, the Government is helping to build the resilience of the agricultural sector against drought," Minister Joyce continued.

"The programme will provide one-off rebates to help eligible farm businesses with the cost of independent and professional advice on an insurance policy that covers threats to their productivity, such as drought and other production and market risks.

"The rebates will provide up to $2,500 in dollar-for-dollar matched funding against the costs incurred by an eligible farm business in securing, or attempting to secure, agricultural insurance.”

With multi-peril crop insurance still an emerging market in Australia, with the first pay-out under the coverage made in January 2015, the announced rebate could spur more farmers towards the cover as Minister Joyce encouraged farmers to weigh-up their options.

"I encourage farmers to consider their insurance options, such as single or multi-peril insurance,” Minister Joyce continued.

“While it may not be suitable for all farm businesses, it has great potential to assist many farmers safeguard their business and provide a sense of financial security.

"This programme will help to develop a more diverse and mature insurance market to meet the varied needs of all farm businesses, with new insurance products already emerging."

For more information on the rebate, visit the Managing Farm Risk Programme website.

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