Production Insurance
Grapes and grape vines

How it works

​​​When you enrol in Production Insurance, you are guaranteed a level of production based on your yield history and the level of coverage you choose. A claim may be paid if an insured peril causes your yield to fall below your guaranteed value.

Insured perils

Gra​pes

  • Blossom set failure due to adverse weather
  • Drought
  • Excessive moisture
  • Freeze injury
  • Frost
  • Hail
  • Excessive wind
  • Excessive heat
  • Excessive rain​
  • Tornado
  • Wildlife
  • Lady beetles
  • Fungal disease (Niagara and Concord varieties only)*

* Provided good farm management practices are followed.

Grape vines

The grape vine rider is added to your coverage if your vines were insured in the previous crop year, or if you notified Agricorp by September 1 and meet eligibility requirements. Newly planted vines must have been planted by June 25 to be eligible for coverage in the next crop year.

​The grape rider gives you additional protection if your grape vines die as a result of one or more of these insured perils:

  • Drought

  • Flood

  • Hail

  • Ice damage 

  • Lightning

  • Excessive wind causing structural damage

  • Winter freeze injury

For more information about this coverage, including how to qualify, see the Fruit Tree and Grapevine Riders Production Insurance Document.

Losses due to uninsured perils

Losses due to uninsured perils such as improper use of pesticides, third-party damage or spray drift, shortage of labour or machinery, insect infestation or plant disease are not covered by Production Insurance unless specifically noted.

Yield losses caused by uninsured perils are removed from your guaranteed production before any claim is calculated.

If the final yield used for insurance claim purposes is less than your guaranteed production (adjusted for any loss due to uninsured perils), a production claim may be paid on the difference. If the final yield is equal to or greater than your guaranteed production (after adjustment for uninsured perils), no production claim is payable.

Calculating your coverage and claims

Your coverage depends on:

  • Your final average yield
  • Your final average Brix (if applicable)
  • Your claim price
  • Your coverage level
  • Your guaranteed production
  • Your guaranteed value

Final average yield (FAY)

An FAY is calculated and used as a benchmark to determine if your actual production is below average.

FAY for existing participants

Your FAY is based on your five to 10 most recent years of actual yields.

FAY for new participants…

You are assigned an underwritten FAY for the first five years of production based on a variety of factors such as location, age and health of vines, soil type, etc. For more details, see the Plan Overview.

Each year that you participate in the plan, your actual yield replaces an underwritten yield until your FAY is composed entirely of your own actual yields.

Final average Brix for Brix varieties

Final average Brix is calculated using your Brix history. You will start with five years of Brix history. Final average Brix is used to determine your claim price using the prices listed in the Brix schedule. 

Quality factor for non-Brix scheduled varieties

If an insured peril reduces the quality of a crop, a quality factor may be applied to the yield to better reflect the price you receive.

This factored yield is used for claim purposes and future FAY calculations and is applied regardless of whether a claim is payable.

The quality factor is determined by dividing the negotiated price for harvested Brix by the negotiated price for 100 percent Brix for that variety. Quality factors are not applied to grapes used for ice wine, because growers receive different prices for grapes crushed for ice wine.

Claim price

When you apply or renew , you select a claim price, which determines your guaranteed value.

Grape claim prices are determined by class. Each class is valued based on last year’s negotiated industry price, as determined by the Grape Growers of Ontario, minus harvesting costs and board fees.

Coverage level

When you apply or renew each year, you choose one coverage level. It determines your guaranteed production.

Guaranteed production

Guaranteed production is determined by multiplying your FAY by your selected coverage level. This number is used to calculate your guaranteed value.

Guaranteed value

Guaranteed value converts your guaranteed production into a dollar amount so your premium can be calculated and any production claims can be paid.

Guaranteed value = Guaranteed production x your selected claim price

Guaranteed value for Brix varieties = your historical yield x claim price based on your final average Brix

Coverage options

You can choose one of several coverage levels and claim price options for these categories:

  • Labrusca
  • Hybrids
  • Vinifera

Each category is covered separately. If an insured peril reduces the yield of one category below the guaranteed production, you are eligible for a claim on the difference regardless of the yield of your other categories.

Choose your vine coverage option

Starting in 2017, more of your vines are eligible for Production Insurance. Before deciding on this year’s coverage, ask yourself: What changes have you made to your business? What risks does your farm face this year? Will your current coverage protect you if you experience a severe, unexpected loss? Choose either standard vine loss coverage, at no cost to you, or additional vine loss coverage, offering you greater coverage at a lower deductible level. 

Below is an example to help you assess vine coverage options and choose which option best meets your business needs.

Example

Scenario 

You have a vineyard with1,000 hybrid grape vines. You lose 200 vines due to freeze injury.

Calculating your options

*Rates used in this example: Premium rate for additional vine coverage: 0.18%; claim price for vines: $15.10; deductible rate for standard vine coverage: 12.5%; deductible rate for additional vine coverage: 5%.

Standard
Coverage

Higher deductible
12.5%
Additional
Coverage

Lower deductable
5%
Premium
 
$0 
Premium
 
$27.18
Premium
Step 1:
Calculate your premium
Your premium = $0
The federal and provincial governments pay the premium on your behalf.
Your premium
= premium rate*
× # of vines
× claim price*
= 0.18%
× 1,000
× $15.10
= $27.18
Step 2:
Calculate your deductible
Deductible
= # of vines
× deductible rate for standard vine coverage*
= 1,000
× 12.5%
= 125 vines
Deductible
= # of vines
× deductible rate for additional vine coverage*
= 1,000
× 5%
= 50 vines
Step 3:
Calculate your vine loss claim
Claim
= (# of vines lost
– deductible)
× claim price
= (200 – 125)
× $15.10
= 75
× $15.10
= $1,132.50
Claim
= (# of vines lost
– deductible)
× claim price
= (200 – 50)
× $15.10
= 150
× $15.10
= $2,265.00
Claim
$1,132.50
Claim
$2,265.00
Claim

​​






Growing Forward 2 – Agricorp – Ontario – Canada