Protein Industries Canada has launched a new project aimed at overhauling how crop insurance is designed and delivered, with the goal of giving farmers and agents more tailored risk management options and creating a more efficient public-private model for agricultural risk.
The initiative is led by Agi3 Ltd, in collaboration with Agi3 Risk Services Ltd and Aon Reinsurance Solutions Canada. The partners will develop an AI‑enabled hybrid public‑private framework intended to modernize and optimize agriculture risk management across the country. Total committed funding is $11.3 million, including $5.1 million from Protein Industries Canada, with the remainder provided by the project partners.
The project will build on Agi3’s existing technical platform and focus on developing and piloting an AI‑enabled framework that better connects public Business Risk Management (BRM) programs with targeted private insurance solutions. Planned work includes new framework design, in‑season risk analytics, product and performance‑layer modeling, and decision‑support tools intended to improve transparency, efficiency, and coordination for farmers, advisors, insurers, and governments.
The aim is to create a structure where existing BRM tools such as government‑backed yield and revenue programs can be more systematically complemented by private layers, parametric options, or top‑up covers that address specific protection gaps, rather than operating as largely separate systems.
“This project is about building the next layer of crop insurance infrastructure in Canada,” said Ray Bouchard, president of Agi3 Ltd. He said Agi3 sees an opportunity to connect public programs, private insurance capacity, and field‑level analytics in a way that expands farmer choice and gives governments and insurers better tools for decision‑making, with a focus on the framework and market design needed to support a more coordinated public‑private model.
Canada’s core farm risk management system is built around federal‑provincial BRM programs, including AgriInsurance (crop and production insurance), AgriStability (margin‑based support), AgriInvest (savings accounts), and disaster response mechanisms. These programs provide important protection but have drawn recurring criticism from producers over complexity, coverage gaps, and payment timeliness, particularly as climate‑related weather extremes and price volatility have increased.
Commercial insurers have generally played a more limited role in Canadian crop insurance than in markets such as the United States, where private carriers deliver federally backed programs alongside their own products. Aligning public program design, farm‑level data, and private risk appetite has been a challenge, making it harder to build efficient layered structures.
By concentrating on a “framework first” approach, the Agi3 project is targeting some of these structural issues rather than simply adding another model or product. For insurers and reinsurers, a more standardized analytical base with clearer attachment points between public programs, direct insurance, and reinsurance could, over time, make Canadian crop risk more attractive and predictable.
The project’s stated goal is to give farmers more tailored risk management options, help advisors and agents present those options more clearly, and support a more resilient crop insurance environment in the face of climate volatility and fiscal pressure. Project partners say efficiency gains at the farm level are expected to flow through the broader food and agriculture value chain, supporting ingredient quality and increasing the share of made‑in‑Canada food products.
Tyler Groeneveld, CEO of Protein Industries Canada, said strengthening food production and value‑added agriculture starts with better processes and systems at the farm level. He noted that increased use of AI‑enabled systems on farms can help position Canada more competitively in global food markets, and argued that evolving risk management programs to support farmers contributes to a stronger domestic food supply.
From the perspective of farmers and advisors, project leaders point to the need for better fit, clarity, and coordination. Producers are managing a wider range of risks—from droughts and floods to disease pressure and input cost swings—while navigating multiple BRM programs and private offerings. The project is intended to ensure that analytics and tools lead to more understandable and practical conversations about coverage levels and product choices, rather than adding complexity.
Aon Reinsurance Solutions Canada will focus on how the analytical tools and framework design can support capacity and capital decisions as the model develops.
A more robust and predictable public‑private framework has the potential to create clearer pathways for private capital to participate in Canadian crop insurance markets, whether through traditional treaty reinsurance, quota share and excess‑of‑loss structures, or alternative risk transfer mechanisms. If the project can produce consistent, “reinsurance‑ready” outputs on portfolio behavior, tail risk, and climate‑driven volatility, it could improve reinsurer confidence and help stabilize capacity in a line exposed to correlation and systemic weather events.
Better data and analytics around yield distributions, regional variability, and program interactions may support more granular underwriting and pricing, as well as more informed discussions with regulators and governments about how risk is shared among farmers, the public sector, and private markets.
The project is being delivered through Protein Industries Canada’s artificial intelligence stream, funded under the federal Pan‑Canadian Artificial Intelligence Strategy, which is intended to drive AI adoption across the economy. Protein Industries Canada is one of five Global Innovation Clusters and is using initiatives like this to support its “Road to $25 Billion” vision for Canada’s plant‑based food, feed, and ingredient sector.
Within that agenda, more data‑driven crop insurance is viewed as one element in building a more resilient and investment‑ready agricultural ecosystem. By improving how yield and revenue risk are managed, policymakers and industry groups hope to create a more stable environment for capital deployment into value‑added processing, plant protein infrastructure, and other agri‑food investments.
The project will be a reference point for how AI, public policy, and private capital may combine to reshape crop risk transfer, distribution models, and the role of reinsurance in a key agricultural market.
If successful, the framework piloted in Canada could offer insights for other countries exploring ways to modernize public crop programs, draw in private capacity, and adapt to a more volatile climate.
