Why exactly is agricultural insurance being targeted for exploitation?
In 2015, national agricultural insurance premium income reached 37.47 billion yuan, with approximately 230 million farmer-policyholder instances, providing nearly 2 trillion yuan in risk protection. Reporters recently conducted research in Guangdong, Hunan, Anhui, Jiangxi, Heilongjiang and other provinces and learned that agricultural insurance, which supports and benefits farmers, has relieved the worries of a large number of farmers, but in some areas it has become an "ATM" for criminals, and the policy leakage effect is worrisome.
Frequent problems of fraudulent insurance, false insurance, and substitute insurance
In order to give play to the supporting and protective role of policy-based agricultural insurance for agriculture, governments across the country have in recent years given large subsidies to policy-based agricultural insurance, with premium subsidy ratios ranging from 10% to 90% depending on the type of insurance. In some places, the huge subsidies have become "fat meat" coveted by a few lawless grassroots officials and insurance companies, who extract funds through false insurance, fraudulent insurance, substitute insurance and other means, and the corruption risk shows characteristics of clustered cases and concealment.
Fraudulent insurance by using others' names to participate in "fraudulent insurance." Tian Moujia, manager of the marketing department of a certain United Property Insurance Company, while responsible for handling policy-based agricultural insurance in a county in Henan Province in 2014, instructed company employees to falsely insure agricultural insurance in the names of villagers, extracting 128,736 yuan in agricultural insurance subsidy funds from the central, provincial, and county levels. Afterwards, in order to honor the premiums advanced by village officials and the promised kickbacks, he also defrauded 114,293 yuan in insurance claims through false claims.
Fabricating insurance subjects or deliberately exaggerating the scale of insurance subjects as "false insurance." From 2013 to 2015, Wu Mou, former director of a township animal husbandry and aquatic products service center in a county in Anhui Province, taking advantage of his position responsible for on-site inspection of sow insurance claims, reported sow insurance participation materials and premiums in the names of 24 people including his relatives, falsely reporting the number of sows and filing false claims. In 2013, the township filed 97 sow insurance claims, and in 2014 filed 29 claims, defrauding insurance companies of 125,000 yuan in claims.
Three-party collusion among grassroots government, insurance companies, and farmers for "substitute insurance": a few grassroots governments, in order to cope with agricultural insurance task assessments, funded and advanced premium payments, and insurance companies returned the premiums borne by grassroots governments and farmers through insurance accident claims, extracting central and provincial agricultural insurance subsidies.
A case handled in recent years by the People's Procuratorate of a county in Hunan Province shows that the county's early rice agricultural insurance premiums were borne by the central government, provincial government, county government, and farmers at ratios of 70%, 5%, and 25% respectively. But in actual operation, the finance of a certain township in the county advanced the 5% that should have been borne by the county, and the township or some village-level finances advanced the 25% of premiums that should have been borne by farmers. The insurance company then returned 30% of all premiums to farmers through false claims, after which the township government recovered 5% from farmers and returned it to township finances, and 25% was returned to township or village-level finances.
Why does "crossing the red line" operation arise?
Grassroots cadres and the public believe that the frequent corruption problems in policy-based agricultural insurance are closely related to the weakening of insurance companies' township and village business management. In some places, the dual squeeze of performance assessment and fiscal pressure has intensified the impulse to "step on the red line," while farmers, as policyholders, often lack awareness of supervision and also lack channels for supervision.
Township and village cadres and part-time co-insurance agents are currently the "last mile" for agricultural insurance implementation. "Our company has 1,000 employees directly engaged in agricultural insurance work, accounting for 70% of the total staff, of whom 70% work in county-level institutions," said Shen Guangbin, deputy general manager of the Agricultural Insurance Department of Anhui Guoyuan Agricultural Insurance Co., Ltd. He said the company assigns 1-2 part-time co-insurance agents in each township and at least 1 part-time co-insurance agent in each administrative village, with the total number of co-insurance agents in the province reaching 18,000.
Reporters learned that most governments pass down policy-based insurance tasks level by level, and ultimately the direct implementation responsibility falls on township and village cadres. They must complete the agricultural insurance coverage tasks assigned from above, and can also receive certain subsidies from insurance companies. "The scope of risk control is too broad, the number of co-insurance agents is large, and business training is insufficient, so it is often difficult to completely prevent phenomena such as favoritism toward relatives and friends and false reporting of damaged areas in their work," said the head of agricultural insurance business at an insurance company in Guangdong.
Major agricultural provinces often have tight finances. They must both pay large amounts of funds to subsidize agricultural insurance premiums and complete assessments of agricultural insurance coverage. Under dual pressure, the impulse of some grassroots cadres to "step on the red line" intensifies. Taking rice insurance as an example, some places require rice insurance coverage to reach more than 90%, and failure to complete the task results in a one-vote veto or deduction of salary and performance pay. A deputy director of the agriculture bureau of a prefecture-level city in Guangdong said that the city has more than 3 million mu of rice, and this item alone requires fiscal subsidies of more than 6 million yuan for premiums, leaving finances stretched.
"A portion of agricultural insurance premiums needs to be borne by farmers, but some farmers have gone out to work, and some are unwilling to pay. In order to collect these few yuan per mu in premiums, I have to ride a motorcycle several times before I can collect it. The money collected is not even enough for gasoline, and many times I would rather advance the money myself to pay premiums for farmers, just to complete the assessment task and avoid having my bonus deducted," said a township cadre in Maoming City, Guangdong Province, responsible for promoting agricultural insurance business.
Some farmers still have weak insurance awareness, lacking both the awareness to actively supervise and the channels to supervise. A survey by reporters in 10 counties across 5 provinces nationwide found that a considerable number of farmers still do not understand agricultural insurance at all, very few understand the loss assessment rules and compensation standards of agricultural insurance, and the public disclosure of underwriting and compensation information is still mostly carried out by posting notices at village committee offices.
The head of an insurance company in Guangdong specializing in agricultural insurance said: "Some insurance companies have very high profit margins on rice insurance, and one of the main reasons is that they simply do not pay claims according to the prescribed standards, while most farmers do not understand these standards, so the insurance company pays whatever it says it will pay."
Liang Yiquan, a villager from Mingtang Village, Beijie Town, Xinyi City, Guangdong Province, said that some administrative villages are several square kilometers in size with more than 1,000 households, yet the public disclosure of underwriting and compensation information is only posted at the entrance of the village committee. Neither the disclosure period nor the disclosure effect can be guaranteed, and when people do not even know the information, supervision is even more out of the question.
Combating corruption in agricultural insurance requires heavy blows and real action
In recent years, the number of agricultural insurance types, coverage rates, and insured amounts have continued to increase, and fiscal subsidies for agricultural insurance at all levels have also grown correspondingly. New agricultural insurance types such as weather index insurance and price index insurance are even more welcomed by the market and play an irreplaceable role. Experts and grassroots cadres believe that agricultural insurance will play a huge role in promoting agricultural supply-side reform and realizing agricultural modernization, and it is necessary to crack down on and prevent corruption with heavy blows to prevent policies beneficial to the people from failing to benefit farmers.
Insurance companies operating agricultural insurance should strengthen supervision over township and village cadres and grassroots insurance business personnel engaged in agricultural insurance business. A relevant responsible person from the Heilongjiang Insurance Regulatory Bureau said that all localities should urge agricultural insurance operating companies to strengthen control over the huge grassroots co-insurance agent team and standardize business training, revise agricultural insurance underwriting and claims procedures, and promote the standardization and normalization of agricultural insurance business; maintain a high-pressure regulatory posture and carry out irregular in-depth special inspections of agricultural insurance, investigating not only illegal problems such as false underwriting and claims data and untrue operating expenses, but also strictly investigating violations that breach business procedures and standards, and strictly regulate the order of the agricultural insurance market.
Higher-level governments should bear the matching premiums that farmers and major agricultural counties and financially poor counties need to pay. Yao Yunfei, deputy director of the Anhui Provincial Agricultural Insurance Office, and others suggested improving the policy-based agricultural insurance premium subsidy policy to further reduce the fiscal subsidy burden of premiums on major grain-producing counties and poor counties. Integrate the use of agriculture-related fiscal funds, and on the basis of farmers' voluntary insurance participation, continuously increase fiscal input, increase the proportion of fiscal subsidies for policy-based agricultural insurance year by year, reduce the proportion of individual farmer payments, encourage innovation pilot programs for policy-based insurance of local specialty agricultural products and pillar agricultural products, and include insurance types with certain brand effects and relatively broad coverage in the provincial policy-based agricultural insurance product catalog.