Azerbaijani Ministry of Agriculture recommends farmers to insure crops

Business Materials 26 April 2010 18:36 (UTC +04:00)

Azerbaijan, Baku, April 26 / Trend U. Ismayilova /

There is no understanding to insure crop among Azerbaijani rural population, the Azerbaijani Ministry of Agriculture department head Sabir Veliyev said.

"Despite the fact that the Azerbaijani ministry of agriculture regularly holds special events to inform rural population about importance of agricultural insurance, farmers do not use services of insurance companies," Veliyev said.

He said that farmers refuse from insuring because of the lack of trust towards insurance companies even despite the fact that according to the Azerbaijani Cabinet of Ministers' decision, about 50 percent of premiums on this kind of insurance must be provided owing to the state budget.

"Insurance of crop and property by farmers can minimize damage as a result of weather," Veliyev said.

The share of premiums in agricultural insurance financed by the state was increased from 25 to 50 percent in accordance with additions to the law on aid and development of Azerbaijani agriculture approved in summer of 2007.

The rest 50 percent are insured by insurance companies. The average tariff for Azerbaijani agricultural insurance hits 1,500 manat per year (5 percent per hectare). The average profit per 1 hectare will reach 25,000 manat per year.

Agricultural crops insured at the state budget's expense include wheat, barley, Indian corn, sunflower, potato, beetroot, vegetables and greens.

The Azerbaijani Ministry of Agriculture applied to the Azerbaijani Cabinet of Ministers in 2008 to expand a list of agricultural crops insured by the state.

On April 26, the official exchange rate is 0.8034 manat to 41.