BFREPA HPAI Cleansing and Disinfection Group Insurance Scheme

Published on : 15 Aug 2022

BFREPA has made the difficult decision not to renew its HPAI group insurance which covered up to 20 members for £50,000 of secondary cleansing and disinfection costs. This is very disappointing news for members and for the Association but perhaps not surprising given the current circumstances following the worst HPAI epidemic in history.

Renewal terms for the cover were provided by underwriters at very short notice, within two days of the old cover lapsing, giving the Association little time to warn members.

The data below shows that the initial renewal quote from insurers was a 221% increase in the premium, together with a condition requiring members to pay 25% of any claim. BFREPA went back to underwriters asking for a quote which halved the cover available in the hope that the renewal cost to the Association could be maintained at existing levels. Despite halving the cover, the quote was still £16,306 more expensive than the previous year and would still require members to pay the first 25% of any claim.

2021-22 Policy
Policy cover: £1m
Flock cover: £50,000
Premium: £23,989
Increase at renewal: N.A
% co-insurance: 0%

Renewal Quote 1
Policy cover: £1m
Flock cover: £50,000
Premium: £29,211
Increase at renewal: N.A
% co-insurance: 25%

Renewal Quote 2
Policy cover: £500,000
Flock cover: £25,000
Premium: £16,306
Increase at renewal: N.A
% co-insurance: 25%

Your Association has taken the view that these quotes are unacceptable on the following grounds:
1. An increase of 221% is unheard of even in this difficult AI insurance market. Most individual policies have increased by 15%-25% at renewal.
2. At the time the renewal offer was presented, not one successful claim has been made against the policy since its start in 2014. Two claims are currently in the pipeline that BFREPA expects will be paid.
3. The paucity of claims has meant that the policy has faced scrutiny as to its suitability of purpose given the worst AI season on record
4. The increase in packers and other industry stakeholders with their own group policies covering members has reduced claims and the value of the policy
5. The costs of secondary cleansing and disinfection in practice have proved to be much less than anticipated when BFREPA started the policy
6. At a difficult time for the industry, its members and the Association, spending another £29,211 of BFREPA funds for a policy that requires members to pay 25% of any claim could not be justified.
Members who do not have exiting AI cover and who might have benefited from the BFREPA secondary cleansing and disinfection cover should contact Scrutton Bland with the aim of obtaining comprehensive disease insurance.
In the meantime BFREPA will continue to research the difficult market (there are only two underwriters) for both AI and/or Salmonella cover in the hoping of finding an affordable group disease scheme.