Insurance companies are forcing increases in premiums on all customers, including farmers, in 2016. The increases are generally highest on motor cover but are also being imposed on other categories such as farm machinery and public liability.

Farmers who have general multi-risk-type farm policies are seeing premiums rise by 10-15%. However, premiums for standalone cover on cars, jeeps and other road vehicles have risen this year by 20% and more.

Farmers are not the worst hit. Some tradesmen and rural businesses renewing cover on vans and other commercial vehicles are reporting premium increases of over 100%.

Examples given to the Irish Farmers Journal include a self-employed rural businessman who insured his 7t flatbed truck for €650 in 2015 but was asked for €1,800 when he went to renew for 2016. After arguing with his broker, he renewed cover for just over €1,200, a near 100% increase.

These higher costs will impact indirectly on farmers availing of services.

The general increase in insurance costs come after a number of years of spectacular losses and closures by insurance companies. These problems have resulted in a reduction in the number of companies operating in the market. For example, only three companies are now offering cover to farmers: Aviva, FBD and Zurich. Only two companies are willing to give cover to agricultural contractors.

Other factors behind the increases are that premiums in recent years fell too low as companies sought to grow market share. Insurers see growth in the broader economy, including more employment. This brings higher risk but it also signals recovery in profits – so insurers raise premiums.

“Also, a lot of claims are going to court,” one insurance operator stated.

“The offers of the Personal Injuries Board are not being accepted. When a case goes to court, then 30% of any claim goes on legal fees.”

The modest rise in premiums for farm multi-risk cover reflects the fact that there is little economic growth in the sector so far in 2016.