Farm Ireland
Independent.ie

Thursday 18 January 2018

Machinery insurance costs set to soar by 30pc

Fears are growing over the rising cost of farm insurance in genera
Fears are growing over the rising cost of farm insurance in genera
Claire Mc Cormack

Claire Mc Cormack

Cash-strapped farmers are facing another financial headache as quotes for machinery insurance are being hiked by up to 30pc, a leading agri-contractor group has warned.

Although agri-related injury claims remain ­consistently low, small, medium and large-scale contractors have been lumped with increasing premiums over the last three years.

Fears are growing over the rising cost of farm insurance in general.

The main insurers in agriculture are FBD, Aviva and Zurich.

Michael Moroney, the newly appointed CEO of Farm Contractors Ireland (FCI), says the soaring cost of machinery insurance needs to be addressed.

"We are seeing big increases in premiums being quoted to contractors at the moment. Some of them are quite significant, up to 30pc.

"Nobody is prepared for a 30pc increase because contractors certainly won't be getting a 30pc increase in charges to farmers.

"It's impossible for them to pass on that level of increase," he said.

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The FCI will hold a number of nationwide meetings with members this week to identify the extent of the problem.

"We're trying to identify why premiums are increasing at such a substantial level because we don't have any indication that claims are increasing.

"It doesn't seem to be machine related, it seems to be business related, the business of farm contracting is experiencing the increase," he said.

"You could have someone at a small scale with two balers and five tractors, and you could have somebody at a big scale with a big outfit with diggers, tractors and trailers. There doesn't seem to be any difference," he said.

Earlier this month, a Government working group made a range of recommendations aimed at bringing down the spiralling cost of motor insurance following repeated calls to cap the size of payouts for certain injuries - most notably whiplash which accounts for 80pc of all motor insurance claims.

The commission will examine payouts for soft tissue injuries and compare them to the average awards in other countries.

Transparency

The IFA said moves towards greater transparency on claims data and more sharing of information on awards is "very positive".

However, a spokesman for Injuries Board Ireland, an independent Irish government body for assistance with personal injury claims and compensation, told the Farming Independent they receive "scarcely more than a handful of ag-related claims every year".

"In order for someone to make a claim, there has to be someone else who is liable. If there was an accident on a farm, in most cases, the person who sustained the injury would also be the owner-occupier of the farm so therefore they wouldn't be in a position to make a claim," he said.

ICMSA President John Comer is "very concerned" at the increasing cost of farm and other insurance, and is calling on the Government to tackle the underlying causes.

"We are expected, as farmers, to compete on a global economy but we pay insurance premiums well in excess of international norms," he said.

"Reforms aimed at lowering premiums must see real results for farmers. In the meantime, farm families are urged to break old habits and consider getting quotes from other insurers and brokers."

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