Central government increases agricultural insurance premium subsidies to benefit farmers
China's insurance regulator said on the 13th that the upgrading and renovation of central-government-premium-subsidized agricultural insurance products carried out nationwide at the start of this year has been completed, covering 15 categories of crops and 6 categories of livestock breeds, totaling 738 agricultural insurance products. After the upgrade, the protection level of agricultural insurance products has increased substantially, insurance liabilities have been significantly expanded, and the benefits to farmers have been continuously strengthened.
Since the central government implemented the agricultural insurance premium subsidy policy in 2007, agricultural insurance has developed rapidly, and its capacity to serve “agriculture, rural areas and farmers” has been significantly enhanced. In 2014, agricultural insurance achieved premium income of 32.57 billion yuan, provided risk protection of 1.66 trillion yuan, covered 247 million farmer households, and underwrote major crops exceeding 1.1 billion mu.
As China's agriculture has continued to develop, the original agricultural insurance clauses could no longer meet the needs of agricultural risk management under the new situation. Narrow insurance liabilities, relatively low protection levels, and relatively strict claim conditions became the issues most strongly reported by the vast number of farmers.
After this upgrading of agricultural insurance products, insurance liabilities have been significantly expanded. On the basis of the original natural disasters, crop insurance has added major disasters such as drought and earthquakes, geological disasters such as debris flows and landslides, as well as damage from pests, diseases, weeds and rodents; livestock insurance liabilities have been extended to all diseases and epidemics. The protection level for major grain crops has been greatly raised, and in most provinces and municipalities nationwide the insured amount has covered direct materialized costs, with the average protection level increased by 10% to 15%.
At the same time, agricultural insurance compensation standards have been raised and claim conditions lowered. The upgraded products have eliminated absolute deductible clauses, and at the same time raised compensation standards for crops at different growth stages and under total-loss situations. Major agricultural provinces have lowered insurance premium rates based on risk characteristics, risk distribution and operating conditions in recent years, and in some areas the crop insurance premium rate has dropped by nearly 50%.
He Hao, deputy director of the Property Insurance Department of the China Insurance Regulatory Commission, said that next the CIRC will improve the product management system, formulate model clauses for major crop insurance, improve the agricultural insurance risk zoning and premium rate floating mechanism, and continue to give play to the positive role of agricultural insurance in supporting agriculture and benefiting farmers.