Addressing Climate Challenges in Agriculture

Climate change is reshaping the agricultural landscape, presenting farmers with a host of new challenges. From unpredictable weather to rising temperatures, the risks to productivity and profitability are growing. For dairy farmers, one of the most pressing issues is heat stress, and addressing it requires innovative solutions.

While traditional insurance plays a vital role in protecting farms, parametric insurance offers a complementary, innovative solution tailored to specific weather-related risks like heat stress. By using measurable triggers, parametric insurance provides fair payouts to help farmers address challenges effectively.

How Parametric Insurance Works

NFU Mutual’s award-winning Dairy Heat Stress Insurance, which has been developed for our existing Farm Insurance customers, with Skyline Partners and is underwritten by Markel, is a prime example of this innovation. Instead of requiring evidence of specific losses, it uses the Temperature Humidity Index (THI) to monitor weather data. If THI thresholds are exceeded at your farm’s location, during the cover period, payouts are triggered automatically, and paid within predefined payment periods. This streamlined process means farmers receive support when they need it most—without the hassle of traditional claims.

Beyond financial relief, parametric insurance empowers farmers to invest in long-term resilience. Payouts can fund infrastructure improvements, such as:

• Installing shade or ventilation systems.
• Enhancing water access for herds.
• Adopting new technologies to monitor herd health.

NFU Mutual’s Dairy Heat Stress Insurance offers a proactive way to manage the risks of climate change, ensuring your farm can adapt and thrive in the face of uncertainty.

This cover is available to purchase between the 6th January and the 1st May, subject to underwriter acceptance, and this would provide cover for identified heat stress events within the 12 month policy period.

Speak with your local NFU Mutual Agent to find the right level of protection for your farm. They can explain the full details to help ensure the cover is right for you. Find your local NFU Mutual Agency office here.