Ein Novum der landwirtschaftlichen Risikovorsorge

Die Gründung der Bayerischen Landeshagelversicherungsanstalt 1884

Abstract

This paper deals with the origins of the Bavarian hail insurance company in 1884. I argue that the private insurance market failed to provide insurance coverage against crop damages, which caused the growth of the agricultural sector to slow down. The first attempts of private hail insurance associations were characterised by a commitment to full coverage of crop damage above 33 percent by the company, while the insurants committed themselves to five year contracts. As these early, small scale insurances never reached a sufficient number of insurance holders, they repeatedly failed to cover for damage. The resulting loss for the insurants, who were nevertheless bound to pay the original rates by their fife-year contracts, ruined the reputation of hail insurance on the whole. The lack of trust was one of the main reasons for this market failure, which incited the government to intervene by establishing a state-run enterprise, resulting in the foundation of the Bavarian hail insurance company.