Why Agricultural Insurance Is Collapsing in Flood-Prone Regions
April 2, 2025 · Frisian News
Insurance companies are abandoning flood-prone farmland across Europe, leaving growers exposed to climate chaos. Farmers cannot afford the premiums insurers now demand, and state backup plans remain vague.
Last month, a dairy farmer in the Dutch province of North Holland received a letter from his insurer: coverage denied, renewal impossible. The company had paid out 180,000 euros in flood claims over three years. The farmer, who has worked the same polder for forty years, had never missed a premium payment. Yet his land sits three meters below sea level, and climate models now show a one-in-seven chance of serious flooding each decade. The insurer did the math and walked away.
Across the Low Countries, Belgium, and northern France, the same story repeats. Over the past eighteen months, thirteen major agricultural insurers have reduced or eliminated coverage for properties in flood-prone zones. Those who remain in the market have tripled premiums in some cases, pricing ordinary farmers out altogether. The German Farmers Union reports that one in five members in Rhine-valley regions can no longer obtain any flood insurance at commercial rates. State-backed schemes fill some gaps, but they move slowly and cover only partial losses.
Insurers blame climate science, not greed. Weather data shows river flooding and extreme rainfall events accelerating across northern Europe. Actuaries recalculate risk every year, and every year the numbers worsen. An insurer that holds too many policies in the flood zone becomes insolvent. A company that raises premiums too slowly goes bankrupt. From their perspective, they have no choice: retreat or fail.
Farmers and policymakers see a different problem. Agriculture anchors rural economies and feeds cities. If insurers abandon the sector, farmers cannot borrow to buy seed or equipment. Banks demand proof of insurance before lending to anyone on vulnerable land. Governments have long relied on private insurers to bear climate risk, shifting costs and decisions to the market. Now that arrangement breaks down, no one has a plan. Brussels talks about "green transition support," but mostly funds are not flowing to regions facing immediate flooding risk. National governments bicker over who should pay.
Some regions experiment with mutual insurance cooperatives run by farmers themselves, pooling risk within local networks. These schemes work if everyone stays, but young people leave flood-prone areas. The cooperatives shrink. Without scale, premiums climb again. A few governments consider subsidizing insurance premiums directly, but that costs money farmers do not have and bureaucrats do not want to spend. The gap between risk and coverage widens. Farmers adapt by selling out, moving to higher ground, or simply hoping the next big flood stays away.
Foarige moanne krige in molkeboer yn de Nederlânske provinsje Noard-Hollân in brief fan syn ferskeringsbedrijf: dekking wegere, ferlingjen ûnmoglik. It bedrijf hie yn trije jier 180.000 euro oan oerstreamingskadeshulen útbetaald. De boer, dy't fjouwertich jier op deselde polder wurke, hie nea in premiebetaling mist. Mar syn lân lit trije meter ûnder seespegel, en klimaatmodellen toane no in kâns fan ien op sân op earne oerstreaming per desennium. De ferskeringsman die de rekkening en gie fuort.
Oer hiel it leechseelân, yn België en Noard-Frankryk herhellet deselde ferhaal him. Yn 'e lêste achttjin moannen hawwe tritjin grutte landbouwferskeringsbedriuwen de dekking yn oerstreamingsgefoelich sonen fermindere of opheffe. Wa noch yn 'e merkt wurksum is, hat de premiums yn guon gefallen tredubele, sadat gewoane boeren it net mear betelje kinne. De Dútske Boerenünje meldt dat ien op fiif leden yn Rijndalgebieden gjin kommersjele oerstreamingsfersekering mear krije kinne. Steatsteun folget guon gaten, mar bewegt heuldrach en dekt allinne dielskea.
Ferskeringsferstanners wize op klimaatwittenskip, net op griedichheid. Wearsfakta toane fersnelle rivieroverstremmingen en ekstreme reinbûger oer Noard-Europa. Aktuarissen herrekenje it risiko elk jier, en elk jier ferslechtere de nûmers. In ferskeringsman mei of folle polissen yn 'e oerstreamingszone wurt insolvint. In bedrijf dat premiums te heul duursum opheft, giet faillyt. Fan har perspektief hawwe hja gjin keus: tsjindraaie of mislearje.
Boeren en beleatspolityk sjogge in ander probleem. Landbou ferankert plattelandsekonomyën en voedt stêd. As ferskeringsbedriuwen de sektor ferleie, kinne boeren net liene foar sied of masines. Banken easkje bewiis fan fersekering foardat hja oan inoar op gefoelich lân útlenje. Regearrings hawwe lange tiid op partikuliere ferskeringsbedriuwen fertroud om klimaatrisiko te dragen, en ferkearde kosten en besluten nei de merkt. No stiert dy regeling yn, en nimmen hat in plan. Brussel prates oer stipe foar 'e "griene tray," mar de middels strume meastal net nei regio's dy't streekse oerstreamingsgefaar helje. Nasjonale regearrings ferkeareljen oer wa betelje moat.
Sommige regio's eksperimentearje mei geamene ferskeringsvereangingskippen fan boeren, mei dielde risiko binne lokale netwurken. Dy regelingen wurkje as elkien bliuwt, mar jonge minsken ferleie oerstreamingsgefoelige gebieten. De vereangingskippen krimpje. Sûnder skaal stije de premiums op nij. In pear regearrings tinke oan premiems direkt te subsidearje, mar dat kostet jild dat boeren net hawwe en amptenaren net útjaan wolle. De gat tusken risiko en dekking wurdt breeder. Boeren handelje troch út te ferkeapjen, nei heger lân te ferhutsjen, of gewoan te hoppen dat de folgjende grutte oerstreaming weibliuwt.
Published April 2, 2025 · Frisian News · Ljouwert, Fryslân