Yahoo Finance Hurricanes posing increasing problems for East Coast fisheries without insurance
It cost fish farmers in Prince Edward Island more than $70 million when Hurricane Fiona hit in 2022. Similarily, owners evacuated the biggest shrimp farm in the United States when Hurricane Milton bore down on Florida last week.
That’s why Peter Warris worries when tropical storms head north.
As executive director of the P.E.I. Aquaculture Alliance, he represents an industry that, strange as it may seem, is largely uninsured against weather disasters. That’s because most shellfish growers say the rates are too high. An insurance policy to cover an oyster or mussel farm can run anywhere from $30,000 to millions of dollars.
“High-energy events are certainly one of the main things I think we’re going to be faced with … and the industry is going to need support,” Warris said.
The alliance has spearheaded a plan that would help the industry recover from future storms by offering an insurance package that would be shared equally between owners and the provincial and federal governments.
But it won’t happen unless governments get on board. So far, P.E.I. has pledged to pay a share, but Fisheries and Oceans and Canada has yet to sign on.
“I make no predictions or promises until someone’s signature is on a piece of paper,” he said, adding that he briefly spoke about the plan with Diane Lebouthillier, who is in charge of the federal ministry.
Land-based farming is protected under the Sustainable Canadian Agriculture Partnership, which offers insurance against damage and losses caused by weather events and other natural disasters.
Warris said Hurricane Fiona was a wake-up call. Initial damage estimates were pegged at $70 million.
That same year, total Canadian shellfish farming was valued at just $125 million.
P.E.I. offered compensation to the industry, administered by the Canadian Red Cross, but the money was slow to arrive. Most growers hadn’t received compensation 18 months after the fund was put in place, but some are still waiting.
Those delays are potentially devastating, said David Cooke, a business insurance broker with Charlottetown-based Cooke Insurance Group, who is working with the Aquaculture Alliance to get the pilot project off the ground. He said in the wake of Fiona, growers were bleeding money trying to rebuild their stock while having little or no product to sell.
Cooke is hoping to come up with a master policy that can be offered to everyone in the industry, with people allowed to opt in or out. Mitchell McConnell Insurance Ltd. is also working on the pilot to get growers back in business as quickly as possible.
“A hurricane or bad storm blows through and (if) there’s a loss of stock, a loss of gear, they’d be able to make a claim and get paid pretty quick,” he said.
Cooke said claims would likely be paid out in a month.
“It would be way faster than trying to get money through a (government) emergency program,” he said. “Anything they get (now) is not enough to get back to where they were and the programs are too slow to respond.”
Making the issue more urgent is that the frequency and severity of storms appear to be increasing.
“The industry is getting hit harder and harder by storm damage. The time has come for a program that gives growers more security,” Cooke said. “All we’ve been doing is reacting, reacting and complaining.”
Cooke said the big question is what governments will do next.
P.E.I.’s Department of Fisheries, Tourism, Sport and Culture said it supports an aquaculture insurance program, but did not disclose how much it is willing to pay nor did Fisheries and Oceans Canada.
But Tomie White, a spokesperson for Fisheries and Oceans Canada, said a working group chaired by the department continues to look at the issue to identifying gaps in coverage.
“Collaborative federal-provincial work continues in this area,” he said in an e-mail.
• Email: arankin@postmedia.com
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