Nika Melnik  

Overview of Livestock Insurance Coverage Available for Farms in Ukraine

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This overview might be interesting for farmers who already own farms in Ukraine, or investors looking for farms for sale in Ukraine or even Ukraine’s land for sale (though this option might be available only after lifting moratorium in 2017).

In Ukraine farms usually have the similar set of core assets at their disposal. They are land, crops, livestock, agricultural machinery, and, of course, farm buildings.  While the usage of crop insurance along with agricultural machinery insurance and property insurance for movable and immovable property is quite widely spread, the livestock insurance is not frequently purchased, though it deserves to be looked into.

So which species living in Ukraine’s farms can be insured? They are mostly cattle stock, pigs, horses (except for race horses), goats, sheep, barnyard fowl, rabbits and nutrias. Certain limitation regarding the insurable age and weight of the livestock are usually set as follows:

  • Cattle stock  - 2 months – 15 years
  • Horses – 2 months – 18 years
  • Pigs up to 5-year olds, but which weigh no less than 15 kg

A number of insurers can cover even the newly born animals, but this happens very rarely.

As to the sum insured, it is usually equal to the real value of the livestock. It cannot exceed book or market value, though. Usually average market value of one animal calculated for the past year in particular region serves as a benchmark for sum insured used in the policies. However farmers or those investors looking for farms for sale in Ukraine should keep in mind that insurance agreement cannot be concluded for those livestock being already sick or if the territory insured is currently under quarantine.

Normally the insurance policy covers the death of livestock caused by following perils:

1. Fire, lightning, explosion.

2. Acts of God: flood, hurricane, windstorm, heavy rain, hail, land subsidence, soil sliding, earthquake.

3. Malicious mischief, including theft, vandalism and robbery.

4. Accidents such as:

  • Electric shock
  • Sudden poisoning by toxic plants or substances occurred on pastures only;
  • Snake or insect bites;
  • Sunstroke or heat stroke;
  • blocking of gastro-intestinal tract caused by foreign objects;
  • attack by wild animals or stray canines;
  • asphyxia, respiratory arrest due to upper airway blockage by foreign objects;
  • traffic accidents

There are certain diseases which are excluded from insurance coverage as in Ukraine farm is subject to indemnity for the losses caused by such diseases to be paid by the government. Recent outbreak of African swine fever is a vivid example of such exception.
5. Epizootic diseases. The insurers indemnify for the losses suffered due to inflectional disease widely spread among one or several species of livestock in a substantial territory resulting in excessive level of morbidity rate typical for this territory.  In this regard another issue should be pointed out. There are certain diseases which are excluded from insurance coverage as in Ukraine farm is subject to indemnity for the losses caused by such diseases to be paid by the government.  Recent outbreak of African swine fever is a vivid example of such exception.

The majority of insurance policies also imply coverage of compulsory slaughter caused by:

  • Insured peril which is sure to result in quick death in the future;
  • Disease threatening the inevitable death or full disability in the nearest future
  • Order by the animal health service due to emergency epizooty – related measures or incurable disease which is sure to result in further disability of livestock

Investors looking for Ukraine’s farms for sale might be interested in knowing that there are also additional coverage options available in the market such as death of animals due to machinery breakdown, surgery etc.

Since the extensive insurance of livestock is very pricy and implies imposing significant deductible amounts, regular Ukraine’s farm cannot boast a full-featured insurance policy with its coverage being limited to standard property damage risks (1-4). However if you made up your mind to find Ukraine’s farms for sale and invest your money in them, you should consider securing your investment as fully as possible. Insurance has proved to be one of the best ways to do so.


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