Agriculture in Germany is facing major challenges due to increasing extreme weather conditions such as drought and flooding. The effects of the climate crisis have long been noticeable for farmers, as this year’s harvest report from the German Farmers’ Association and the Ministry of Agriculture makes clear: the grain harvest was below average in many regions due to capricious weather. But despite the growing risks, few farmers have taken out insurance against extreme weather.
One reason for this: the costs for such policies, especially during drought, are simply too high for many companies. Government funding for insurance against extreme weather has therefore been called for for years. However, experts emphasize that this funding should be subject to clear conditions. The NABU (Nature Conservation Association of Germany) demands that companies only receive government aid once they have taken fundamental measures to adapt to climate change.
“Insuring a farm that doesn’t take enough precautions is like leaving your expensive bicycle unlocked at the train station. If it is stolen, no insurance will pay,” explains NABU agricultural expert Pierre Johannes. Companies would therefore first have to invest in measures that increase the resilience of their cultivation methods, demands the nature conservation organization. These include, among other things, protection against soil erosion, water-saving irrigation methods and the cultivation of climate-resistant plants.
State funding to insure against extreme weather damage was last discussed at the federal level in September 2020, but was rejected. The federal government argued that it could intervene in the event of damage of national proportions, such as the drought in 2018, and that responsibility for natural disasters lies with the federal states. Some federal states such as Bavaria, Baden-Württemberg and Rhineland-Palatinate already offer subsidies for special crops. From 2023, Bavaria plans to support arable land, grassland and special crops with up to 50 percent of the premiums for comprehensive insurance. In addition, the insurance tax for drought insurance was significantly reduced in 2020.
