Why are 5 million acres of Ontario farmland insured under Production Insurance each year?
In a word:
Production Insurance protects Ontario producers from yield reductions and crop losses caused by factors beyond their control, including adverse weather, disease, pests, wildlife or other uncontrollable natural perils.
When you enrol in a Production Insurance plan for grains and oilseeds, you are guaranteed a level of production that is 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 production.
Production Insurance is part of the suite of programs available under the Canadian Agricultural Partnership. In most plans, producers pay 40 per cent of the total premium cost and none of the administration cost. Together, the federal and provincial governments contribute the other 60 per cent. Administrative costs are fully funded by both levels of government.