Agricultural insurance protects against loss of or damage to crops or livestock. It has great potential to provide value to low-income farmers and their communities, both by protecting farmers when shocks occur and by encouraging greater investment in crops. It further covers pre-sowing and post-harvest losses owing to cyclonic rains and rainfall deficit. However, in practice, its effectiveness has often been constrained by the difficulty of designing good products and by demand constraints.
The global agricultural insurance market size is predicted to reach over USD 42.31 billion by 2028. The global agricultural Insurances market is expected to show 3.6% CAGR during the coming years.
This can be ascribed to the growing demand for agricultural insurance from the agriculture sector to safeguard the land and crops of the farmers. Increased technological development and subsidies offered by the government are primarily proliferating the customer demand for agriculture insurance. This is observed as a key factor driving the agricultural insurance market growth on a global scale.
However, the high cost of premiums for insurance and lower awareness of agricultural policies among farmers are expected to hamper the growth of the market. Especially, lack of awareness about such policies and schemes is making the agriculture insurance market compromise on the compounded growth rate. To overcome these issues, governments are increasing creating awareness among farmers regarding the benefits associated with agricultural insurance.
Agricultural Insurance Market Scope
|Revenue forecast in 2028
|USD 42.31 billion
|CAGR of 3.6 % during 2018-2028
|Type, Application, Regions
|North America, Europe, Asia Pacific, Middle East and Africa, South America
|Key Players Profiled
|PICC, Zurich (RCIS), Chubb, QBE, China United Property Insurance, American Financial Group, Prudential and XL Catlin, Everest Re Group, Sompo International (Endurance Specialty), UNA Mutual, Agriculture Insurance Company of India, Tokio Marine, CGB Diversified Services, Farmers Mutual Hail, Archer Daniels Midland, New India Assurance, and ICICI Lombard among others.
Key Segments of the Global Agricultural Insurance Market
Type Overview (USD Billion)
- Digital & Direct Channel
Application Overview (USD Billion)
Regional Overview (USD Billion)
- Rest of Europe
- Rest of Asia-Pacific
Middle East and Africa
- South Africa
- Rest of Middle East and Africa
- Rest of South America
Frequently Asked Questions (FAQ) :
The growing adoption of technology in the agriculture insurance sector is observed as the significant factor driving the overall market growth. The Digital agriculture ecosystem has been supporting precision farming. This technology help farmers to improve the efficiency of their work, reduce cost and improve outcome by analyzing the data collected from sensors, satellite, smart equipment, weather, and other services. Agriculture insurance utilizes this technology to offer better opportunities to develop and revolutionalize more in the agriculture sector.
The increase in the need for protection from loss in the agriculture business and the rise in the adoption of agriculture insurance is observed as some of the prominent factors driving the market for agriculture insurance across the globe. Changing weather conditions and parallelly growing demand for agricultural products are imposing pressure on farmers regarding the heath of farms and the quality of farm products. To balance these factors, farmers are increasingly experimenting with lands and crops to improve the agriculture field’s productivity and quality of the crops. This factor is further giving rise to the risk associated with the field and agricultural output. As agriculture has been the primary occupation for farmers’ in many developing countries, damage to the field or crops reflects largely on the farmer's income. To protect the agricultural sector from this loss, the government is announcing multiple subsidiaries for farmers to increase the adoption of agriculture insurance.
Based on the type segment, the market is bifurcated into bancassurance, digital & direct channel, broker, and agency. The market is mainly distributed considering the different policies that differentiate agriculture insurance. With the growth in digitization across developing as well as developed countries, the digital & direct channel insurance segment is anticipated for the highest growth during the forecast period. However, brokers and agencies are further expected to set a decent growth rate in the overall agriculture insurance market.
Based on the application, the market is segmented into crop/MPCI, crop/Hail, livestock, and others. The Crop/MPCI seized the maximum market share in 2020 and it is likely to maintain its place throughout the forecast years. The growth of this segment is largely ascribed to an increase in demand for multiple & personalized coverage for crop insurance, a rise in several partnerships, and the development of existing offerings of multi-peril crop insurance (MPCI) products.
The Asia-Pacific is likely to gather noteworthy growth through the forecast years 2021-2028. The domination of this region is largely ascribed to the growing agricultural sector across the region. The growth of the agricultural insurance market in this region is mostly ascribed to the growing agricultural sector across the countries such as India, Japan, and China to improve and protect their fields while ensuring high-quality crops and land fertility. Growth of the agricultural Insurance industry could also be attributed to North America which introduced revenue-based Agricultural Insurance and, more recently, emerging markets such as China, India, and Brazil, driven by rapidly increasing insurance penetration.
The major players of the global agricultural insurance market are PICC, Zurich (RCIS), Chubb, QBE, China United Property Insurance, American Financial Group, Prudential and XL Catlin among others. Moreover, the additional prospective market players in the agricultural insurance market are Everest Re Group, Sompo International (Endurance Specialty), UNA Mutual, Agriculture Insurance Company of India, Tokio Marine, CGB Diversified Services, Farmers Mutual Hail, Archer Daniels Midland, New India Assurance, and ICICI Lombard among others. The companies are increasingly adopting several strategies including product launches, partnerships, collaborations, mergers & acquisitions, and joint ventures to strengthen their presence in the global agricultural insurance market.