REGINA — Saskatchewan’s farmer-owned crop hail company paid out $103.6 million in claims last year, compared to $57.8 million in 2023.
President Jason Friesen updated delegates at the Saskatchewan Association of Rural Municipalities earlier this month, noting Municipal Hail Insurance, created in 1917, provides coverage at cost.
“After 108 years, municipal hail continues to operate on those founding principles and has paid out in claims 77.5 cents of every dollar collected in premium. This is the highest return rate in the crop hail industry,” he said.
Friesen said 2024 was the third time in recent history that several crop hail insurers reached capacity and had to close new sales by the third week in June. They no longer had the financial capacity or reinsurance to write the necessary business, he said.
MHI has the capacity to write up to $4.4 billion in coverage.
Overall, the crop hail industry in the province wrote $6.5 billion of coverage last year and MHI provided $3.6 billion or 55 percent of that.
Adding coverage purchased in Alberta and Manitoba pushed that number over $4 billion, which is the company’s largest total to date.
The company offers coverage under Saskatchewan Municipal Hail Insurance, Additional Municipal Hail Insurance and Prairie Municipal Hail Insurance.
Friesen said 2024 was marked by late June storms with severity considered greater than average, although there really is no average in this business.
July was quiet, and late August and September were busier than usual, meaning loss adjustments later in the season were delayed.
Still, payments went out within 30 days of assessment date and often within 30 days of the storm date, he said.
The company added $28 million to its retained earnings last year, pushing assets to nearly $281 million.
Income generated from retained earnings is used to cover operating expenses and limit rate increases in heavy loss years, Friesen said, and also allows coverage at cost.
Two years ago delegates to the annual general meeting voted to explore providing coverage for perils other than hail.
“We are progressing cautiously at this, working with advisers to secure a license and develop a program under AMHI to provide another risk management tool,” he said, adding it’s too early for more details.
Farmers will notice a change to their indemnities this year. The minimum remains $30 per acre, but the maximum has been reduced under the provincial government formula from $425 to $400 per acre.
Friesen said everyone knows the expenses to grow a crop have not fallen and neither have machinery or land costs. MHI will be working with the government to adjust the formula and make sure it is responsive.
It also uses one percent of net premium written for community projects. Friesen said he is most proud of contributing to the Hospitals of Regina Foundation catheterization lab and STARS air ambulance.
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