4 Apr 2011

New livestock insurance now available

3:06 pm on 4 April 2011

Sheep farmers will be able to insure their stock against serious loss for the first time, under a new livestock catastrophe scheme.

Rural insurer FMG says it has developed the scheme in response to the spring blizzards last year that killed hundreds of thousands of farm animals, mainly lambs and sheep, in the central North Island and lower South Island.

While growers have been able to insure against crop losses from destructive weather such as hailstorms, that sort of protection has not been available to livestock farmers before.

FMG says the new scheme is not designed to cover the capital cost of replacing lost stock.

But insurance general manager Conrad Wilkshire says it will provide farmers with forward cover, which would be triggered if they lose more than 15% of their sheep in a disaster such as a storm or flood.

Mr Wilkshire says there are four options ranging from $25,000 to $100,000 worth of cover.

He says many farmers would be looking to litigate the immediate cash flow impact within the season they are in.

Mr Wilkshire says the company is anticipating that many farmers will go for a middle of the road strategy and take about $50,000 worth of cover which would typically cost about $700.