The manner of determining premium rates shall be subject to the Regulations and the National Certification Guidelines (NCG), specifically in this Annex G, the "Guidelines for Actuarial Certification of Premium Rate Methodologies of AgriInsurance programs, Agriculture and Agri-Food Canada, April 1, 2019, and the "Guidelines for Actuarial Certification of Self-Sustainability of AgriInsurance programs, Agriculture and Agri-Food Canada, April 1, 2019".

Details on the methodologies used to determine premium rates and premiums are set out in the Actuarial Certification documents, identified in clause 1.1 of this Annex.

Canada, at the request of a province, can assist a province to develop Requests for Proposals (RFPs) for actuarial services. Such collaboration could ensure that all NCG requirements are addressed in the RFPs.

The actuarial certifications referenced in this annex remain valid, even if the methodologies are modified, where the Province and Canada mutually agree with the changes and they are attached to the certification.

1.0 Certification of Premium Rate Methodology

  • 1.1 The actuarial certification opinion on premium rate methodologies, as required under section 7(1)(a)(i) of the Regulations, is provided in the documents:
    • Actuarial Certification of the Premium Rate Methodologies for Crop Year 2022 Spring Crops" prepared by Julie-Linda Laforce, FCIA, FCAS and Sarah Ashley Chevalier, FCIA, FCAS, of Axxima Inc., dated June 3, 2022.
    • Actuarial Certification of the Premium Rate Methodologies and Assessment of 93rd Percentile for Crop Year 2022 Fruit Crops" prepared by Julie-Linda Laforce, FCIA, FCAS and Sarah Ashley Chevalier, FCIA, FCAS, of Axxima Inc., dated June 3, 2022.
    • Actuarial Certification of the Premium Rate Methodologies for Crop Year 2022 Fall Crops" prepared by Julie-Linda Laforce, FCIA, FCAS and Sarah Ashley Chevalier, FCIA, FCAS, of Axxima Inc., dated June 3, 2022.
  • 1.2 The actuarial certification opinion on the discounts and/or additional coverage offered through the Whole-farm Option (or Basket of Crops), is required under Section 7(1)(a)(i) of the Regulations. This program is non-active but not decommissioned.
  • 1.3 Actuarial assessment of the 93rd percentile loss level for any applicable plans as required by section 5.5 of the AgriInsurance Agreement is provided in the above premium rate certification.

2.0 Certification of Self-Sustainability

  • 2.1 The actuarial opinion on the overall financial self-sustainability of the AgriInsurance Program, as required under section 7(1)(a)(ii) of the Regulations, is provided in the document Actuarial Certification of the Assessment of Self-Sustainability for Crop Year 2022" prepared by Julie-Linda Laforce, FCIA, FCAS and Sarah Ashley Chevalier, FCIA, FCAS, of Axxima Inc., dated May 31, 2022.

3.0 Certification Due Dates

Premium rate methodology

  • 3.1 Unless there is a major change to the premium rate methodologies, the next certification of the premium rate methodology is not due until April 1, 2027. If there is a major change in the premium rate methodology, the Province shall provide or cause to be provided, a written opinion signed by an Actuary that the methodology has been established in an actuarially sound manner.
  • 3.2 Unless there is a major change in the methodology to calculate the discounts and additional coverage for the Basket of Crops option, the next certification of the methodology to calculate the discounts and/or additional coverage for the basket of Crops is not due until there is participation in the plan. If there is a major change in the methodology to calculate the discounts and/or additional coverage for the Basket of Crops option, the Province shall provide a written opinion signed by an Actuary that the methodology has been established in an actuarially sound manner.
  • 3.3 The next actuarial assessment of the 93rd percentile loss level for all applicable plans is due on April 1, 2027, unless there is a major change in the methodologies.

Self-Sustainability Assessment

  • 3.4 Unless there is a major change in the premium rate methodology of the AgriInsurance Program, the next certification of the overall financial self-sustainability is not due until April 1, 2027 based on risk assessment. If there is a major change in the premium rate methodology, the Province shall provide or cause to be provided a written opinion signed by an Actuary that the AgriInsurance Program is financially self-sustainable as defined by the National Certification Guidelines noted above.

4.0 Calculation of High-Cost Premiums and Ineligible Amounts

For High-risk Agricultural Products plans, premium costs above the 9% rule threshold shall be cost shared at the High-Cost level.

Risk-splitting Benefits, other than those identified in the AgriInsurance Agreement, section 5.16 are funded at High-Cost Production Loss Coverage level. Where the conditions of the AgriInsurance Agreement section 5.18 are not met, both the Risk-splitting Benefit and the Base Insurance Plan shall be cost shared at the High-Cost Production Loss Coverage level as per the AgriInsurance Agreement section 5.19.

When the aggregate value of a Province's Premiums allocated to Producer-Paid Production Loss Coverage exceeds 1 per cent of the Province's previous Production Year total liability for Comprehensive and High-Cost Production Loss Coverages, the excess value of the Province's Premiums will be funded at High-Cost Production Loss Coverage level.

The Province shall calculate or cause to be calculated, premiums associated with High-Cost Production Loss Coverage level of funding and related ineligible amounts every year and submit for Canada's review and implementation.

Yield-Based Plans

The maximum Coverage Level that can be cost shared is 90%. For plans with Coverage Levels greater than 90%, premiums related to the portion of coverage greater than 90% shall not be eligible for any Federal Premium Cost Share.

Plan Changes Implemented without AAFC's Approval: When a Province implements plan changes or introduces new plans without AAFC's approval, 10 per cent of Federal Cost Share of the premiums related to the affected plans shall be treated as ineligible amounts.

AAFC shall review the ineligible amounts calculated by the Provinces and implement those ineligible amounts. Ineligible amounts less than $50 shall be treated as zero.

Non-Yield-Based Coverage Plans

The maximum Coverage Level is 90% or 1-LTAL (Long Term Average Loss). For plans with Coverage Levels greater than 1-LTAL (or greater than 90% when the LTAL cannot be determined), the premiums related to the portion of coverage greater than 1-LTAL shall not be eligible for any Federal Premium Cost Share.

Plan Changes Implemented without AAFC's Approval: When a Province implements plan changes or introduces new plans without AAFC's approval, 10 per cent of Federal Cost Share of the premiums related to the affected plans shall be treated as ineligible amounts.

AAFC shall review the ineligible amounts calculated by the Province and implement those ineligible amounts. Ineligible amounts less than $50 shall be treated as zero.

5.0 Follow-up on Last Certification Recommendations and on Agreements for Modifications Requested by Canada

The Province shall implement or cause to be implemented the recommendations made by the Actuary in the actuarial certifications unless Canada has agreed with the Province in writing not to implement a particular recommendation. The Province shall make or cause to be made, adjustments to reflect the modifications requested by Canada and agreed to by the Province.