An interesting anniversary was celebrated last week in the province as the Saskatchewan Crop Insurance Corporation hit 50 years.
The idea of crop insurance has come a long way in five decades.
"Before 1961, crop insurance was offered on an area basis through the Prairie Farm Assistance Act. Premiums were based on a percentage of sales: the higher the yield, the higher the premium. Coverage was the same across the province resulting in townships with low average yields paying lower premiums but receiving indemnities more often than townships with higher yields," detailed the SCIC website.
"In 1961, the federal and provincial governments granted permission to operate a pilot program in 25 areas of the province, mainly in the east and northeast. (That year) 194 producer applications were accepted from a total of 439 province-wide.
"Approximately 31,700 acres and three insurable crops were covered. Wheat, oats and barley were insurable with a coverage of 60 per cent of the long term average yield. The price option was $1/bushel for spring wheat."
In retrospect those are rather humble beginnings, but the trial year was enough to show crop insurance was both wanted, more than 400 applicants that first year showed that, and that it could work in terms of providing farmers with some level of security in regards to their main farm crops.
That is really what insurance comes down too. You invest some dollars in a program which kicks in as a safety net in times of distress, whether car insurance and you are in an accident, fire insurance if a home burns, and crop insurance if drought or other problem impacts production.
Like any insurance, crop insurance is not perfect, in respect to covering every producer for every problem which might arise, at least in terms of making them a profit, but it does provide a rather stable base safety net for the majority of producers.
So fast forward to 2006 and numbers on the SCIC website, where it states "SCIC insured 66 per cent of all land seeded in Saskatchewan, with approximately 28,200 customers insuring 22.1 million annual acres and 500,000 forage acres under the multi-peril programs. An additional 2.5 million acres were covered by weather-based insurance products."
What is also interesting is how the insurance program has diversified as have farmers. The trial run before 1961 covered only three cereal crops.
Today the list of crops is long, covering such crops as canary seed, triticale, faba beans, camelina, corriander, wild rice, vegetables and even honey.
Farming has changed in 50-years, significantly so, and the SCIC has played a role in allowing that to happen. By diversifying what it covers in recent years it has become more relevant as a safety net program for producers who have evolved into much more diverse producers.
The SCIC has grown and evolved and been there for farmers through a number of federal and provincial governments, and while most of the time farm programs get buried in paperwork and ultimately fail, GRIP, NISA and others come to mind, crop insurance has been a shining example of what can be achieved.
