Govt agencies studying feasibility of forming agricultural reinsurer
Source: Asia Insurance Review | Dec 2019
The relevant authorities are currently studying the feasibility of establishing a national agricultural reinsurance company, to strengthen agricultural insurance services in the country.
This is one of several measures highlighted in the ‘Guiding Opinion on Accelerating the High-quality Development of Agricultural Insurance’, a statement issued jointly in October by the CBIRC, Ministry of Finance, Ministry of Agriculture and Rural Affairs and the National Forestry and Grassland Administration.
The guide aims to tackle issues of compensation, fraudulent acquisition of financial subsidies, false underwriting, and false claims on the one hand and to promote the ‘guarantee prices, guarantee income’ function of insurance to minimise the double risks of natural disasters and market price fluctuations for farmers.
The guide states that China will improve its agricultural insurance system with expanded coverage and functions to allow it to better serve farmers.
Agricultural insurance covers losses due to natural disasters, plant diseases and pests and other risks. The central government usually provides subsidies to help farmers pay the premiums.
Agricultural insurance took off in China only in 2007 when policy agricultural insurance was introduced to the whole country. At the policy level, the coordination of interests among agriculture, insurance, finance, forestry and other departments has been increasing over time. A
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