With the ongoing drought and ever-changing weather patterns, crop insurance for maize producers is more important than ever before. With the help of an expert intermediary, they can better understand their risk, how their insured loss will be determined and how to make an informed decision of the level of cover they require. Here are five reasons why clients should safeguard their crops with Santam.
- Insurance that protects the crop
Maize producers earn their money from the cultivation and sales of maize. Therefore, it makes sense for them to choose an insurance product that protects their crop instead of only a few of the many factors that contribute to the final harvest. It serves no purpose to be covered against a few events only, such as ‘inadequate rainfall’ or ‘inadequate vegetative growth’. Even if one or both these factors are positive, it still does not guarantee a good harvest.
- Remunerated for their loss in yield
When the price of maize is to their advantage, it’s understandable that maize producers won’t want to share their profit with their insurer. A maize producer would probably want to enjoy all the benefits of the maize price, preferring to be remunerated for their loss in yield at the maize price that they chose at the time of taking out the insurance. Maize producers don’t want their price benefit to be calculated against the loss in yield that they suffered in order to minimise the insurance claim.
- Actual individual yield per farmer versus average yield for a group of farmers in the same area
You can’t apply a one-size-fits-all approach to crop insurance. No two neighbouring farms will ever get the same amount of rainfall each season. They will never start planting on the same day, nor will they use the same seeds, cultivation practices and fertiliser programmes. It is not realistic to expect that all maize producers in the same area will have the exact same yield per hectare in any given season, therefore it doesn’t make sense for an individual insured loss to be calculated on the average maize yield of all the producers in a specific area.
Your client will likely know from experience that there are huge differences in yield just among the various fields on their farm – never mind the difference between their harvest and that of other producers in their area. Typically a maize producer would choose to enjoy cover against the difference between their own long-term average yield and the yield that they actualise at harvesting season.
- World-renowned product
Your clients will only use the very best, world-class production tools, therefore it makes sense for them to choose an insurance product that large numbers of commercial maize producers all over the world use to protect their crop.
- Proven track record
When a client is insured by Santam, they can enjoy peace of mind knowing that their crops and assets are fully covered by technical experts who understand the demands of the agriculture industry. We are the only South African insurer with a proven track record built up over 100 years.
Get in touch with your relationship manager if you have any queries about the Santam’s crop insurance. For more advice tailored to intermediaries, visit our blog for useful product-related articles such as how farmers can better understand their risk and liability.