The optimization of the insurance costs can be achieved both by reducing part of
insurance premium cost, or through the unification and simplification of insurance
contracts, reducing the their administration costs, which is achieved through the
creation of a unified field underwriting, improvement of methods of conducting
surveys of crops, regulation of losses, unification of experts work.
The consequences of the financial and economic crisis have led to a significant
reduction in the budget support of the agricultural sector, and from 2009 onwards, the
complete refusal to subsidize the value of insurance premiums to agricultural
producers.
Since 2017, Ukraine has obtained state support through a special VAT regime.
The amount of budget support for the agricultural sector is set at 1% of the value of
agricultural products produced by the agrricultural sector. We consider that budget
expenditures should include funds for the compensation of part of the insurance
premium.
The current legislation determines state support as the provision to the agricultural
commodity producer of funds from the state budget in the form of subsidies to pay for
the part (no more than 50%) of the insurance payment (premium) accrued under the
insurance contract [12].
We propose to determine state support for agricultural risk insurance as a
provision of funds from the public budget to agricultural producers in the form of grant-
in-aid to pay for part (not more than 50%) of insurance premiums charged under the
insurance contract which concluded with an insurance company (a member of the
Agricultural Insurance Pool) and by providing guarantees of public reinsurance.
In order to increase the attractiveness of commodity producers, we recommend
the use of the discount system at insurance rates for enterprises that annually insure
crops and are disciplined payers.
We consider it necessary to provide adequate funding on a stable basis of
government support and make some changes in the mechanism of providing subsidies
and determining their size. Above all, emphasize the introduction of partial
reimbursement of the cost of insurance premiums to insurant not insurer, as is done in
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