Development opportunities for the insurance of agricultural crops and livestock in Poland

Abstract

The experience of countries of the Community clearly indicate that the existing risk management instruments (including insurance subsidized) are not fully utilized, and what more do not guarantee fully the financial stability of farms. Hence appear the new needs for innovative risk management tools in agriculture. The aim of the study will attempt to assess past experience in the implementation of agricultural insurance in Poland (including subsidized recommended to UE.
For the analysis of the legal status were used the Polish insurance regulations and European Union (EU) legislation in the range of the functioning of risk management tools recommended by the Common Agricultural Policy (CAP). Conducted analyses indicate that the market for crop insurance and livestock is poorly used by Polish farmers. It is estimated that only 12% of farms in Poland insures their crops. In the case of animals the situation is even more unfavourable, as in Poland are insured only 5% of the animals. Moreover, the level of the utilization of subsidies for agricultural insurance is low. In 2014, for crop insurance and livestock is allocated in the budget the amount of approx. 201 million polish zloty (PLN). The level of subsidies utilization amounted to about 80% and it was about 10 p.p. lower than in 2013. In 2015, the amount of subsidies remained similar to the 2014 level and amounted to about 200 million PLN. The analysis shows that many farmers do not decide to buy insurance. Lack of comprehensive system solutions for the protection of risk in agriculture will force the need to introduce the new instruments Risk Management in Poland.