Forage Insurance Review Background

Manitoba Agricultural Services Corporation (MASC) provides forage insurance products to help Manitoba agricultural producers manage forage production risks. Presently, only 18 per cent of Manitoba’s forage land is insured, compared to 90 per cent of Manitoba’s annual crop acreage.

The back-to-back production challenges faced by forage producers in 2018 and 2019 have impacted provincial and local feed supplies. The decrease in available forages is affecting producers’ ability to maintain herd size and negatively impacting farm finances. 

Manitoba’s Minister of Agriculture and Resource Development has initiated a review of the forage insurance program. This review is intended to gain an understanding about the forage insurance purchasing decisions of Manitoba producers. Producers will have an opportunity to identify how the program does or does not meet their needs, and also recommend changes. 

Background 

MASC currently insures 1,282 forage producers and a total of 272,764 acres.  It is estimated there are an additional 1.5 million acres eligible for insurance under the Forage Insurance program.

The governments of Manitoba and Canada pay 60 per cent of the premium cost and all of the program administration cost.

In 2014, the Manitoba Forage Program was redesigned, with the following improvements:

• Select Hay Insurance was added to provide separate coverage for each hay type (e.g., alfalfa, alfalfa/grass, grass, sweet clover and coarse hay), without offsetting between types when calculating claims.
• Probable yields changed from an area based average to an individual’s 10-year yield history. For producers without 10 years of production data, an accelerated coverage methodology is used to more quickly reflect their own data in their coverage.
• An Optional Basic Hay Program was added to provide hay coverage based on the production of the entire farm regardless of hay type.
• A free Hay Disaster Benefit (HDB) was included with all forage insurance products.  The HDB provides additional indemnities in claim years when there are significant provincial forage shortfalls. This accounts for the higher price of hay and transportation. The premium associated with this option is fully funded by the governments of Manitoba and Canada.

A full description of MASC’s forage insurance programs are available online at https://www.masc.mb.ca/masc.nsf/program_forages.html