OREANDA-NEWS. October 26, 2009. The representatives of Ingosstrakh IJSC took part in the 2nd International Investment Forum “Food Industry in Russia – Special Features and Raising Investments During Economic Crisis” that was held as part of the International Exhibition “Agroprodmash-2009” in Moscow.

Heads of ministries and agencies, investment companies, banks, scientists, representatives of Russian and foreign companies specializing in manufacturing, processing and sale of food and equipment for food and manufacturing industries gathered for the Forum. They discussed measures of regulation of the Russian and European agricultural and food system, performance results of the agricultural and food industry, prospects for development of the Russian and world food market.

Deputy General Director of Ingosstrakh IJSC Nikolay Galushin delivered a presentation on Agricultural and Industrial Insurance in 2010: Insurer’s Forecast. He said, inter alia, that in 2009 the segment of agricultural insurance not related to government support became much more active. Insurers, who previously never worked in this area, have entered this market. Regardless of the crisis, a number of the largest Russian banks and western investment companies also showed an interest in the Russian agricultural market. 

According to the experts of Ingosstrakh IJSC, the volume of the agricultural insurance market is RUB 12-13bln, and it has the capacity to grow to RUB 60bln.  However there remains one problem that hinders the development of this industry - total lack of understanding of the future system of insurance with government support. The authorities haven’t yet developed any rules for this segment and there’s no clear understanding of how this system will work, both among insurers and potential insured persons (agricultural producers).

In 2009, the amount allocated for the government support was sequestered. At the same time, although there is an obvious lack of funding and control over the use of funds, there are ideas proposed on the state level to establish a company for agricultural insurance or to provide government support to farms who suffered from drought, which is also hampering development of agricultural insurance.

According to N. Galushin, it will be possible to develop agricultural insurance provided that both agricultural producers and regulating authorities realize that insurance is a modern market institute, and not a form of fraud. Insurers want to develop a civilized market of agricultural insurance in the country; however support is needed from the Russian Insurance Surveillance Service and the Ministry of Agriculture.