{"id":13245,"date":"2020-03-19T13:52:46","date_gmt":"2020-03-19T11:52:46","guid":{"rendered":"https:\/\/modecon.mnau.edu.ua\/?p=13245"},"modified":"2020-03-19T14:05:40","modified_gmt":"2020-03-19T12:05:40","slug":"current-situation-and-prospects-of","status":"publish","type":"post","link":"https:\/\/modecon.mnau.edu.ua\/en\/current-situation-and-prospects-of\/","title":{"rendered":"Dranus, V. & Dranus, L. Current Situation and Prospects of Agricultural Insurance Development in Ukraine"},"content":{"rendered":"

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JEL Classification<\/strong>: G 22.<\/span><\/td>\nDOI<\/b>: https:\/\/doi.org\/10.31521\/modecon.V19(2020)-08<\/a><\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

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Dranus\u00a0Valentyn<\/strong>, Ph.D. in Economics, Associate Professor Petro Mohyla Black Sea National University, Mykolaiv, Ukraine<\/p>\n

ORCID ID<\/strong>: 0000-0001-5617-6740<\/a>
\ne-mail<\/strong>: drval8@ukr.net<\/a><\/p>\n

Dranus\u00a0Liubov<\/strong>, Ph.D. in Economics, Associate Professor Petro Mohyla Black Sea National University, Mykolaiv, Ukraine<\/p>\n

ORCID ID<\/strong>: 0000-0002-6427-1315<\/a>
\ne-mail<\/strong>: lyuba_melnichuk@ukr.net<\/a><\/p>\n

Current Situation and Prospects of Agricultural Insurance Development in Ukraine<\/h2>\n

 <\/p>\n

Introduction<\/strong>. Insurance is an integral part of modern business processes and the most important way to minimize economic losses due to adverse events and phenomena. By facilitating the redistribution of risks between economic agents and the accumulation of losses through insurance, it (insurance) allows to increase the efficiency of the economy as a whole and its individual elements. The role of insurance is particularly important in the agricultural sector, as it is mostly prone to natural and climatic risks. As a financial institute of insurance for the domestic economy it is at a rather low level in comparison with foreign experience: a narrow range of insurance products, primitive technologies, underdeveloped infrastructure, does not fully take into account the specificity of the agricultural sector.<\/p>\n

In many ways, the development of insurance agribusiness is constrained by insufficiently developed theoretical and methodological issues and, consequently, by the poor validity of its priority areas. Noting that the problems of formation and development of the market of insurance services in the agrarian sphere are quite deeply theoretically and practically investigated, it should be acknowledged that in the present conditions many issues related to the specifics of the development of insurance market institutions require further research, including: development of methodological approaches to determine the main directions of development of agricultural insurance; substantiation of the concept of insurance development in agriculture of Ukraine.<\/p>\n

Purpose<\/strong>. Theoretical substantiation of priority directions of the agricultural insurance system development and the formation of practical recommendations on the basis for their implementation are observed.<\/p>\n

Results<\/strong>. The question of the current state of agricultural insurance in Ukraine, which is developing, mainly in quantitative terms due to the expansion of insured areas, nomenclature of insurance objects, is considered. Improving the quality of industrial risk insurance, which is reflected in the effective use of funds for these purposes, the application of reinsurance, differentiated insurance rates, the implementation of insurance payments in the presence of real damage and in the amount stipulated by insurance conditions, remain unresolved. The reasons, why agricultural insurance is not required is that the current agricultural insurance system has a number of significant disadvantages. The biggest problems remain of financial and economic nature, which include, first of all, the difficult financial position of agricultural producers, high loss of agricultural insurance and insufficient development of the reinsurance market. The low solvency of farmers determines the need for state support, since the need for borrowed funds to pay insurance premiums, even in the presence of subsidies, is maintained when underinsured, and under the insurance against total loss of crops, and in the case of combined tariffs.<\/p>\n

Another defining reason why agro – insurance has not yet become an effective financial protection tool for the industry is the lack of awareness among agricultural producers about its capabilities. Because of this, the level of insurance coverage is often misjudged at the stage of concluding an insurance contract. The current state of agricultural producers’ insurance market, the price of current insurance tariffs and conditions of using insurance products, the size of the franchise, insurance coverage and insurance indemnity in case of unfavorable conditions for salt are analyzed as well as the differences in periods of crops acceptance for insurance. The differences between index and mutual insurance from traditional ones, the characteristics and methods of index calculation, the possibility of combining manufacturers to cover the risks that fall out of index insurance coverage are established.<\/p>\n

The level of application of risk management instruments, reasons for refusal of insurance products, opportunities and conditions for improvement of the state on the agro insurance market, application of reinsurance operations with insured acreage of agricultural crops, combination of different types of agricultural insurance, advantages and disadvantages of alternative insurance instruments, possibilities for insurance options, are determined as well as their widespread use in agricultural insurance.<\/p>\n

Conclusions<\/strong>. The necessity of using innovative insurance instruments in the financial activity of agricultural producers, the necessity of the state policy improvement in the field of agricultural insurance and creation of the necessary conditions for the development of the agrarian insurance market that could satisfy the needs of all participants of the insurance market were proved.<\/p>\n

Keywords<\/strong>: Agricultural Insurance; Mutual Insurance; Index Insurance; Reinsurance; Yield Index; Weather Index.<\/p>\n

References:<\/strong><\/p>\n

    \n
  1. State Statistics Service of Ukraine. Official web-site<\/em>. Retrieved from http:\/\/www.ukrstat.gov.ua [in Ukr.]<\/li>\n
  2. Navrotskyi, S. A. & Paliukh, O. M. (2015). Comprehensive assessment of the effectiveness of development of the agricultural sector of Ukraine, taking into account the impact of public funding. Ekonomichnyi chasopys-\u0425\u0425I<\/em>, 3-4(1), 88-92. [in Ukr.].<\/li>\n
  3. Aleskerova, Yu. V. (2014). Improving state support for agricultural insurance. Oblik i finansy<\/em>, 4 (66), 95-102. [in Ukrainian].<\/li>\n
  4. Dranus, V. V. (2016). Organizational and economic model of management of industrial risk insurance with state support in agriculture. Naukovi pratsi. Ekonomika<\/em>, 275(263), 18-22. [in Ukrainian].<\/li>\n
  5. Sinitsyna, T. V. (2011). Crop insurance products: a comparative haracteristic. Ahrosvit<\/em>, 9, 48-52 [in Ukrainian].<\/li>\n
  6. Zaripov, A. Agricultural insurance in Ukraine: problems and solutions. Retrieved from https:\/\/aggeek.net\/ru-blog\/agrostrahovanie-v-ukraine-problemy-i-resheniya [in Russ.].<\/li>\n
  7. Shustur, O. Minimizing operational risks: insurance for farmers. Retrieved from https:\/\/landlord.ua\/news\/minimizatsiia-operatsiinykh-ryzykiv-strakhuvannia-dlia-ahrariiv\/ [in Ukrainian].<\/li>\n
  8. Gudz, O. Ye. (2006). Agro-risk insurance and directions of development of agricultural insurance in Ukraine. Ekonomika APK<\/em>, 8, 72\u201376. [in Ukrainian].<\/li>\n
  9. Agricultural risk insurance – crop production. Retrieved from http:\/\/consoris.com.ua\/rast\/ [in Ukrainian].<\/li>\n
  10. Cost of cost insurance and basic conditions that affect the price of agricultural insurance. Retrieved from http:\/\/agro-insurance.com\/tariff\/87<\/li>\n
  11. International Finance Corporation: IFC. Official web-site<\/em>. Retrieved from https:\/\/www.ifc.org [in Ukrainian].<\/li>\n
  12. Nazarenko, M. Indeksne strakhuvannia dlia ahrariiv: sut ta perevahy. Retrieved from https:\/\/propozitsiya.com\/ua\/indeksne-strahuvannya-dlya-agrariyiv-sut-ta-perevagy [in Ukrainian].<\/li>\n
  13. Index Insurance for Farmers: The Essence and Benefits. Retrieved from http:\/\/agro-insurance.com\/product\/97 [in Russ.].<\/li>\n
  14. Ukrainian Hydrometeorological Center. Official web-site<\/em>. Retrieved from https:\/\/meteo.gov.ua [in Ukrainian].<\/li>\n<\/ol>\n

    [\/vc_column_text][\/vc_column][\/vc_row][vc_row][vc_column][vc_column_text]Received:<\/strong> 13 November 2019<\/p>\n

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    Dranus, V. & Dranus, L. (2020). Current Situation and Prospects of Agricultural Insurance Development in Ukraine. Modern Economics<\/em>, 19(2020), 46-51. DOI: https:\/\/doi.org\/10.31521\/modecon.V19(2020)-08.<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

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    [vc_row][vc_column][vc_column_text] JEL Classification: G 22. DOI: https:\/\/doi.org\/10.31521\/modecon.V19(2020)-08 [\/vc_column_text][vc_column_text] Dranus\u00a0Valentyn, Ph.D. in Economics, Associate Professor Petro Mohyla Black Sea National University, Mykolaiv, Ukraine ORCID ID: 0000-0001-5617-6740 e-mail: drval8@ukr.net Dranus\u00a0Liubov, Ph.D. in Economics, Associate Professor Petro Mohyla Black Sea National University, Mykolaiv, Ukraine ORCID ID: 0000-0002-6427-1315 e-mail: lyuba_melnichuk@ukr.net Current Situation and Prospects of Agricultural Insurance Development in
    Read more<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[127],"tags":[128],"class_list":["post-13245","post","type-post","status-publish","format-standard","hentry","category-19-2020","tag-19-2020"],"_links":{"self":[{"href":"https:\/\/modecon.mnau.edu.ua\/en\/wp-json\/wp\/v2\/posts\/13245"}],"collection":[{"href":"https:\/\/modecon.mnau.edu.ua\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/modecon.mnau.edu.ua\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/modecon.mnau.edu.ua\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/modecon.mnau.edu.ua\/en\/wp-json\/wp\/v2\/comments?post=13245"}],"version-history":[{"count":0,"href":"https:\/\/modecon.mnau.edu.ua\/en\/wp-json\/wp\/v2\/posts\/13245\/revisions"}],"wp:attachment":[{"href":"https:\/\/modecon.mnau.edu.ua\/en\/wp-json\/wp\/v2\/media?parent=13245"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/modecon.mnau.edu.ua\/en\/wp-json\/wp\/v2\/categories?post=13245"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/modecon.mnau.edu.ua\/en\/wp-json\/wp\/v2\/tags?post=13245"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}