Sompo International Holdings Ltd., a Bermuda-based specialty provider of property and casualty insurance and reinsurance, and SV SparkassenVersicherung (SV), one of the largest public insurance companies in Germany, today announced that they have introduced an innovative insurance product, SV ErnteIndex, tailored to the agriculture sector.
SV ErnteIndex offers farmers parametric protection against crop losses such as drought, heavy frost or prolonged wet weather. Payment is based on a ten-year average crop yield index for the district in which the farm is located as well as yield and market price projections determined by the farmer at the time the product is purchased. The SV ErnteIndex parametric product is designed to be part of an overall farm risk management program which complements traditional loss-based crop insurance. Because the contract is parametric and not loss-based, complex and potentially time consuming claims assessments are avoided. The typical contract duration is one year and the product can be used for a wide range of conventional and organic crops.
With a specialty in the agriculture sector, SV has offered tailored insurance solutions to farmers for many decades. SV’s extensive expertise across a broad range of products has enabled them to build long-term client relationships and achieve a lead market share among German agriculture producers.
Mr. Kris Lynn, Senior Vice President, Global Agriculture for Sompo International, commented, “Through our partnership with SV, we are delighted to bring SV ErnteIndex to the market. This product offers German farmers a simple but effective insurance cover to protect their crops. In catastrophic years such as 2018 when severe drought devastated crop yields, farmers will realize the true value of multi-peril crop insurance.”
“The ErnteIndex now offers a solution in which the farmer himself decides how to insure his risks,” added Dr. Klaus Zehner, member of the Board of Management for Property/Casualty at SV SparkassenVersicherung. “In addition, we are in discussions with the state to provide additional incentives to make this product even more attractive to farmers.”
