MRC: the new compensation system

On Monday, October 24, the Groupama Federation of Local Banks of the Jura presented the main lines of Multi-risk Climate Crop Insurance (MRC) to the Chamber of Agriculture and union representatives. In the event of exceptional losses, the agricultural disaster scheme is replaced by a National Solidarity Fund (FSN).

This new multi-risk climate insurance will be effective from January 1, 2023. Presented during the Council of Ministers on July 29 by Bruno Lemaire, Minister of Economy and Finance, and Marc Fesneau, Minister of Agriculture and Food Sovereignty , the ordinance “on the development of climate risk management tools in agriculture” specifies the reform of the crop insurance scheme provided for by the law of March 2, 2022. This introduced new methods of compensation for losses of harvests resulting from climatic hazards, through risk sharing between the State, farmers and insurance companies. A budget of 680 million euros has been included in the finance law to top up this insurance and the DSF.

“The sky has fallen on our heads”

“In 30 years, we have never seen so many claims,” contextualizes Jean-Pierre Gros, president of the Groupama Federation of Local Banks of Jura. “For the region, their number has doubled. There was drought, frost, but above all hail. The sky has fallen on our heads several times. This loss ratio had become unsustainable: since 2016, crop insurance had been in deficit because it lacked policyholders”. By its magnitude, the historic freeze of April 2021 caused an “insurance electroshock”.

The MRC wants to be the cornerstone of the agricultural policy because it participates in national sovereignty. It is becoming the main tool for securing farms in the event of a hazard and dealing with global warming. The main challenge will be to insure as many people as possible, the objective being to allow each farmer to sign contracts under reasonable conditions.

Double the rate of insured farmers

At the national level, only 17.2% of the UAA is currently insured (30.9% for field crops; 34.1% of vines; 4.2% of orchards and barely 1% of meadows). The ambition of the reform is to double the rate of farmers covered by 2030 to reach 60% in arable farming and viticulture, and 30% in arboriculture and grassland. Groupama wants to take advantage of the reform to relaunch its prairie insurance (Read interview with François Schmitt).

With the old crop insurance, the contracts were subsidized at 65% with a deductible of 30%. They will now be subsidized at 70% and policyholders will have the choice between three levels of deductibles: 20, 25 and 30%. The reference yield remains the Olympic average calculated from the last 5 years.

Current contingencies, with a level of loss lower than the deductible chosen, will be assumed by the farmers. Significant hazards, up to 50% loss, will be covered by insurance. In the event of extreme hazards, losses greater than 50% will be covered by the solidarity fund. They will be 90% covered by the FSN and 10% by the insurer if the operator is insured. If it is not, the DSF will only cover 45% of losses beyond 50%.

Choose an authorized contact

Insurers will be responsible for paying all indemnities, including those arising from the FSN: all farmers, whether they have taken out MRC insurance or not, will therefore have to choose a single authorized contact person before March 31 and declare it on a platform of the ‘State.

Hail hazards are included in the MRC but for those who do not subscribe to it, it will always be possible to take out this insurance separately.

Groupama now wishes to communicate with farmers and in particular with the relatively uninsured Jura wine sector: 32% of the national vineyard is insured against only 20% of the Jura vineyard. According to national figures, 2017 and 2021 are the worst years since 1945 for vineyards.

“Now is the time to think about your insurance,” concludes Jean-Pierre Gros. “We must not wait for the hazards”.


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