UK farmers could lose £30m in major avian flu outbreak: Aon

UK poultry farmers stand to lose as much as £30m in a major outbreak of avian flu due to EU regulations affecting government compensation, said Aon.

According to the broker, the regulations mean there is a potentially significant gap between the compensation received for slaughtered birds and the amount a poultry farmer could have expected to earn for each bird.

Poultry farmers are legally obliged to advise the government if they suspect that their stock is infected with avian flu. The Department for Environment, Food and Rural Affairs (Defra) will immediately order the farm to slaughter all poultry at the location, dispose of the dead birds and clean up the site.

“An avian flu outbreak could have devastating consequences on your profits but adequate insurance and a business continuity plan can help prevent this. As the government will only provide limited compensation to farmers, the new policy will address the risk to your business and provide the funds to replenish your stock.

Steve Hibbert, broking manager at Aon

Aon has launched an insurance policy to bridge the gap between government compensation for birds slaughtered at an infected farm and the profit from the wholesale value of the poultry.

Steve Hibbert, broking manager at Aon, said: "We've already seen strands of avian flu in Suffolk, Merseyside and North Wales threatening our poultry farmers in 2007. Before the next strand hits the UK, we wanted to create a policy to protect poultry growers from business ruin.

"An avian flu outbreak could have devastating consequences on your profits but adequate insurance and a business continuity plan can help prevent this. As the government will only provide limited compensation to farmers, the new policy will address the risk to your business and provide the funds to replenish your stock."