Agriculture Insurance Market By Type (Crop/MPCI Insurance, Crop/Hail Insurance, Livestock Insurance, and Others), By Distribution Channel (Agency, Broker, Bancassurance, and Direct Writing), and By Region- Trends, Analysis and Forecast till 2034

Agriculture Insurance Market was valued at USD 42.6 Billion in 2024 and is projected to grow at a CAGR of 6.30% to reach USD 74.2 Billion by 2034.

Agriculture insurance is a useful risk management tool that farmers may use to minimize losses and maintain the operations of their enterprises. Natural catastrophes including drought, floods, cyclones, storms, landslides, earthquakes, etc. regularly have an impact on agricultural productivity and farm earnings. The occurrence of diseases and man-made catastrophes like fires, the selling of phony seeds, fertilizers, and pesticides, price collapses, etc., increase agriculture's susceptibility to these calamities. 

The goal of agriculture insurance is to assist farmers in better managing their revenue and output while lowering the financial risk and uncertainty they confront. Farmers and insurance providers enter into a contractual arrangement whereby farmers pay a premium to receive coverage against potential losses brought on by uncontrollable weather, pests, illnesses, and other unanticipated events. Indemnity payments are another feature of agriculture insurance that helps policyholders avoid financial burdens by compensating them in the event of insured losses. One of the main factors propelling the agricultural insurance market is the explosion of digital initiatives that are changing risk assessment via the use of technology like satellite imaging and data analytics. Furthermore, government assistance, particularly in the form of subsidies, is essential in promoting farmer involvement and sustaining agricultural earnings.

Agriculture Insurance Market Drivers:

Increasing climate uncertainties and calamities

• The need for farm insurance is being stimulated by the increased frequency of extreme weather occurrences, such as storms, floods, and droughts, which raise the risk of agricultural produce. A research report released in April 2023 by the European Parliament stated that over 50% of all drought losses in Europe are related to agriculture, with the Mediterranean area having the greatest sector share (60%) and the boreal region having the lowest (39%). Remarkably, 60% of the financial losses may be attributed to 3% of catastrophic catastrophes. In 2015, the drought's financial toll on Europe's agricultural industry was estimated to be €4.8 billion, and in the worst-case scenario, that figure may rise to €28.6 billion by 2100.
• In addition, the need for risk mitigation strategies is being driven by crops' growing vulnerability to pests and diseases as a result of shifting climatic trends. Also, farmers are becoming more conscious of how climate change affects their field of work, which motivates them to look for ways to hedge against crop uncertainty. Consequently, throughout the projection period, there would be a rise in the market for agriculture insurance.

Government reforms and programs

• Agricultural insurance may benefit greatly from government policy, which works to increase the accessibility and cost-effectiveness of insurance options for farmers. Governments can support agricultural productivity while lowering the financial risks faced by farmers and agriculture-based businesses by collaborating effectively with the private sector through public-private partnerships, subsidies, risk-sharing programs, and supportive regulatory frameworks.

• To assist farmers in need, the Indian government has implemented several reforms, including the Pilot Unified Package Insurance Scheme (UPIS) (45 districts), Weather-Based Crop Insurance Scheme (WBCIS), Coconut Palm Insurance Scheme (CPIS), and Pradhan Mantri Fasal Bima Yojana (PMFBY). These programs' primary goal is to mitigate the risks that different natural and man-made disasters pose to the production and income of farmers. These measures support the farmers' financial stability and the market's growth over the projection period.

Agriculture Insurance Market Restrains:

Lack of awareness and high cost of Agriculture insurance

• Historically, there have been several issues with the agriculture insurance market, including expensive premiums, late CCE, unpaid claims, and a lack of transparency. The absence of established methods and knowledge regarding farm insurance poses a serious risk to the global market. Because of a lack of awareness and comprehension as well as increased costs, crop insurance policies are hard to come by, which restricts market expansion.

Agriculture Insurance Market Opportunities:

Technological advancements

• The integration of ICT has allowed for easy accessibility of insurance as well as various other aspects, which has led to the growth of the agriculture insurance market. For example, to reduce the risk of over-reporting the insured area and streamline the enrollment process, a geo-referenced solid cadastral map basis and its connection with land records data are utilized.
• The extensive application of artificial intelligence (AI) technology to customize plans for specific farmers is directly responsible for the market's explosive growth in agricultural insurance. These studies provide several ecological insights, including those linked to water stress and crop health, and may be used to forecast production and profit utilizing CCE employing A.I. These developments in the farm insurance sector present profitable chances for the market to grow substantially in the forecast period.

Agriculture Insurance Market is segmented based on Type, Distribution Channel and region:

Type Insights:

• Crop/MPCI Insurance:

Federal Crop Insurance Corporation (FCIC) offers crop coverage under the broad term Multiple Peril Crop Insurance (MPCI). A variety of naturally occurring disasters, such as disease, drought, fire, flooding, and insect damage, are covered by multi-peril crop insurance plans, as the name implies, for agricultural producers.

• Crop/Hail Insurance:

Insurance against damage and devastation caused by hail and fire is known as crop-hail insurance. Farmers purchase it to safeguard crops that are still in the field and have yet to be collected. Because hail may destroy a large portion of a cultivated field while sparing the remaining portion, it is particularly valuable.

• Livestock Insurance:

Livestock insurance shields the animals from mishaps and unforeseen circumstances. All animals, including pigs, cattle, sheep, goats, hens, and a combination of them, are protected by this policy since the insurance coverage is customizable.

• Others:

This type segment includes other niche insurance products like farm machinery breakdown insurance, weather-based crop insurance, coconut palm insurance, and aquaculture insurance.

Among the segments mentioned above the one that dominated the market is the Crop/MPCI Insurance as it is popular in many middle-income nations because of its broad range of protections against a variety of risks and dangers coverage and nearly complete indemnity against losses.

Distribution Channel Insights:

• Agency:

Agents from several agencies provide individualized advice, answer questions, and assist in enrolling in policies. Additionally, they serve as a conduit between farmers and insurers, facilitating the understanding and accessibility of insurance choices in regional contexts.

• Broker:

Insurance brokers serve as mediators for farmers and insurers, providing knowledgeable counsel on the particulars of coverage and policy selection. Because they are well-versed in a variety of insurance products, brokers can assist farmers in making well-informed judgments.

• Bancassurance:

In Bancassurance, a bank and an insurance business enter into an agreement that permits the insurance company to market its goods to the bank's customer base. It may significantly reduce the risks and credit rationing issues that family farms have when operating, it opens up new possibilities for eco-friendly family farm production and supports sustainable agricultural growth.

• Direct Writing:

A direct writing agent is an advisor who exclusively represents one insurer in the sale of insurance products. So, they solely concentrate on marketing the insurance goods of one firm and don't put clients in touch with different insurance providers like banks.

Among the segments mentioned above the one that dominated the market is the Bancassurance segment as it involves banks and since they are well-established networks, the farmers often trust them. Banks offer a variety of insurance schemes that will suit the financial condition of the farmers.

Regional Insights:

Agriculture Insurance Market Regional Insights

• North America market is estimated to witness a significantly high revenue share over the forecast period, because of the demand from emerging economies, growing consumer awareness of the value of insurance coverage and measures to mitigate risks, and rising consumer spending on the latest technology.
• Asia Pacific market is estimated to witness the largest revenue share because of the rising government efforts and programs, as well as the high risk of natural disasters in the area.
• Europe market finds lucrative market opportunities because of the growing population, improving agricultural production, and growing understanding of the advantages of agriculture insurance.
• Latin America market is increasing gradually as a result of the adoption of agricultural activities, growing government policies and reforms, and rising awareness among people about agriculture insurance.
• The Middle East & Africa market is an emerging market as a result of the rising number of natural calamities, more people becoming aware of agriculture insurance, and more and more initiatives taken by the governments of the regions.

Agriculture Insurance Market Report Scope:

Attribute	Details
Market Size 2024	US$ 42.6 billion
Projected Market Size 2034	US$ 74.2 billion
CAGR Growth Rate	6.30%
Base year for estimation	2023
Forecast period	2024 – 2034
Market representation	Revenue in USD Billion & CAGR from 2024 to 2034
Market Segmentation	By Type - Crop/MPCI Insurance, Crop/Hail Insurance, Livestock Insurance, and Others. By Distribution Channel- Agency, Broker, Bancassurance, and Direct Writing.
Regional scope	North America - U.S., Canada Europe - UK, Germany, Spain, France, Italy, Russia, Rest of Europe Asia Pacific - Japan, India, China, South Korea, Australia, Rest of Asia-Pacific Latin America - Brazil, Mexico, Argentina, Rest of Latin America Middle East & Africa - South Africa, Saudi Arabia, UAE, Rest of Middle East & Africa
Report coverage	Revenue forecast, company share, competitive landscape, growth factors, and trends

Segments Covered in the Report:

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends and opportunities in each of the sub-segments from 2024 to 2034. For the purpose of this study, has segmented the Agriculture Insurance Market report based on Type, Distribution Channel and region:

Agriculture Insurance Market, By Type:

• Crop/MPCI Insurance
• Crop/Hail Insurance
• Livestock Insurance
• Others

Agriculture Insurance Market, By Distribution Channel:

• Agency
• Broker
• Bancassurance
• Direct Writing

Agriculture Insurance Market, By Region:

• North America
  • U.S.
  • Canada
• Europe
  • Germany
  • UK
  • France
  • Russia
  • Italy
  • Rest of Europe
• Asia Pacific
  • China
  • India
  • Japan
  • South Korea
  • Rest of Asia Pacific
• Latin America
  • Brazil
  • Mexico
  • Rest of Latin America
• Middle East & Africa
  • GCC
  • Israel
  • South Africa
  • Rest of Middle East & Africa

The key players operating the Agriculture Insurance Market include People’s Insurance Company of China Limited, The Chubb Corporation, QBE Insurance Group Limited, XL Group Limited, Tokio Marine Holdings, Inc., Allianz SE Reinsurance, Great American Insurance Company, Sompo International Holdings Ltd., Agriculture Insurance Company of India Limited (AIC), and  Everest Re Group.

• In July 2023, Agi3 Risk Services (ARS) and Definity Financial Corporation collaborated to introduce AgriEnhance, an AI-powered crop insurance program. The new product is the first crop insurance option available on the Agi3 platform from ARS. Its capabilities, which are meant to help farmers come up with creative methods to secure their crops, were made possible by the Definity company Economical Insurance. Through the partnership, Definity can make use of these characteristics and apply real-time changes to coverage and pricing in response to changing risk profiles.

• People’s Insurance Company of China Limited
• The Chubb Corporation
• QBE Insurance Group Limited
• XL Group Limited
• Tokio Marine Holdings, Inc.
• Allianz SE Reinsurance
• Great American Insurance Company
• Sompo International Holdings Ltd.
• Agriculture Insurance Company of India Limited (AIC)
• Everest Re Group