Aims to address the estimated $US113 billion global crop protection gap.
DAS (Digital Agriculture Services) has launched a crop insurance solution in Australia as climate change-related payouts continue to rise, and growers seek better protection against financial losses.
Aimed as a solution for farm insurers, underwriters and their intermediary partners including brokers, agents, loss adjusters and their reinsurers, DAS's solution uses machine learning, automapping and geospatial data to improve the accuracy of crop insurance policies.
"We devised it with the goal of preventing premium leakage, reducing mistakes in policy issuance, minimising fraud and speeding up claims," DAS founder and CEO Anthony Willmott said.
"It delivers dual benefits for insurers and the growers they protect by spatially locating insured paddocks and verifying their insurance status and details; then identifying crop type, estimated and actual yields to provide almost full visibility on the property insured."
The launch comes amid a broader challenge for the industry in the form of premium leakage. This is where policyholders pay less than the amount of risk actually present, leading to potential revenue losses for insurers and greater risk for growers through under-insurance.
It has been estimated that there is at least a $US113 billion crop protection gap (premium equivalent) with 60 percent of insurable crops globally unprotected by insurance in 2022. At least 21 per cent of Australian farm businesses are classified as cropping farms.
Willmott added: "Under-insurance is a thorny issue in Australia's agricultural insurance sector. One of the largest concerns is that insurers' willingness or reluctance to invest in the agricultural insurance market will increase as climate change continues to impact the cost of crop insurance. Meanwhile, cost has also been continually cited by producers as the biggest deterrent for broader uptake of crop insurance.
"So this solution is a win-win for both insurers who want to decrease loss ratios and costs that lead to higher premiums, and producers who want competitive rates for insuring their land."
DAS' solution can be integrated into traditional farm pack cover or used to support standalone crop insurance cover. This increases the availability and affordability of insurance for farmers, while ensuring underwriters can better take on agricultural business risks directly connected to crop production. It can also be leveraged in tandem with DAS' other suite of geospatial solutions, which allow any insurers to visualise insured density at any location, postcode or region.
The launch builds on DAS' work helping its current insurance partners such as IAG, Guidewire and Insurance Facilitators to assess agricultural assets with an unprecedented level of precision.
"Stronger climate events have only served to disincentivise the insurance industry from driving innovation in this sector," Willmott said.
"Our goal is to use data and geospatial tools to support nuanced products for specific insurance segments, helping the overall global scalability of this form of rural insurance."
"Australia is our first market for this solution with plans to scale it globally. Other markets operate more nuanced insurance solutions due to increased government participation in their schemes."
"This makes this country an ideal test case for how we can use geospatial data to organically enhance the viability of crop insurance and test whether technology can side-step the need for it to be subsidised. DAS' solution is the only rural-specific location intelligence suite in the Australian and New Zealand market."
DAS has offered data solutions covering the lifecycle of the world's most important commodity -- grain -- for over five years. The company is the only rural specific location intelligence in the market globally, with deep expertise in the agri-insurance sector. Use cases include reducing under-insurance; preventing claims leakage and cherry picking of coverage; enhancing underwriting outcomes; improving customer and portfolio mix; along with individualised farm reporting for rural insurance customers.
DAS grain intelligence, powered by advances in satellite technology, has proved instrumental in decision making for a number of agendas including: risk mitigation, food security and trade. DAS' models are developed with more than 109,000 ground truth locations, including more than 13,000 locations for 2024.
Background on crop insurance:
Unlike any other form of insurance, crop insurance constantly shifts with regards to the risk towards natural capital which is affected by frost, cold snaps, heatwaves, floods, hail or fire. While crop insurance is subsidised by the government in many markets like the United States or Canada, Australia does not have a federal or national crop insurance policy.
About DAS
DAS is a technology company that delivers location intelligence for financial services and enterprises, with a unified system of data, insights, software and CRM integrations. A product-focused fintech, DAS is accelerating innovation across the entire agri-enterprise ecosystem. Decision-makers use DAS' unique ecosystem of products and tools to get the multi-dimensional intelligence they need to lend, insure, invest and sell better in a dynamic climate.
Five years ago, DAS pioneered its vision for the Rural Intelligence Platform™, transforming how decisions are made in the businesses surrounding agriculture for a safer, more resilient, more prosperous, more sustainable world. Today, DAS' platform has evolved to meet an acute area of need for financial services and agri-enterprise, with over 140 customers including Rabobank, IAG, Australian Bureau of Statistics (ABS), Nutrien, Cargill and Viterra. Integrating location intelligence, climate, productivity, sustainability, risk and carbon data, it offers the multi-dimensional intelligence they need to lend, insure, invest and sell better.
Media contact:
Harrison Polites
0409 623 618
harrison@themediaaccelerator.com.au