Creation of National Mortality Insurance Programme

by 5m Editor
9 November 2011, at 9:34am

CANADA - Aon Benfield says the Canadian Swine Health Board's initiatives aimed at improving on farm biosecurity are making the development of a national mortality insurance programme for swine much easier, writes Bruce Cochrane.

In response to severe losses incurred by Canada's pork producers as a result of circovirus the Canadian Pork industry has been working for several years on the development of a national mortality insurance programme.

"Implementing Mortality Insurance in the Canadian Swine Industry" was among the topics discussed last week as part of the third Canadian Swine Health Forum.

Gary Hutchings, with Aon Benfield, observes from an insurance industry perspective, the Canadian Swine Health Board's National Biosecurity Standard and Biosecurity Training programme are welcome news.

Gary Hutchings-Aon Benfield

What we're looking at is an industry that's taking itself into a position where it becomes an insurable risk.

That has two benefits.

It benefits obviously the insurance sector because it can look at that and be more confident about what it's insuring and with confidence comes competitive rating because an insurer will look at if he hasn't got confidence he puts it back in the rate.

You make the rate higher because I'm not confident that that isn't going to occur.

That's the first thing.

The second thing is it's going to have a significant impact on the producers themselves because they currently carry that risk, they currently carry the loss.

Reduce the risk, mitigate it, manage it more effectively you end up reducing your costs and getting yourself into a more profitable position than you were.

I think thirdly is the benefit to the overall government which still carries a lot of exposure.

It carries the risk for all of those reportable diseases, the big ones and they're very expensive.

If you have an industry that's managing its risk in the way that it is now assisted by the CSHB and many other groups then you're reducing that exposure for the government because it reduces the likelihood of one of those big events occurring ergo it reduces potential costs in the future.

Mr Hutchings hopes to see a national mortality insurance programme proposal tabled by the end of March of next year.