China to upgrade agricultural cover scheme

China to upgrade agricultural cover scheme | Insurance Business

China to upgrade agricultural cover scheme

China will expand the coverage and functions of its agricultural insurance system, in a move that it says will allow it to better serve farmers.

According to a report by Xinhua, a joint circular issued by the Ministry of Finance, Ministry of Agriculture and Rural Affairs, China Banking and Insurance Regulatory Commission, and the National Forestry and Grassland Administration stated that the coverage of insurance on the planting of rice, wheat and corn should exceed 70% by 2022.

Agricultural insurance covers possible losses in crop yield or quality due to natural disasters, diseases, pests, and other risks. Subsidies are usually provided by the government to help farmers afford the premiums.

Furthermore, the proportion of agricultural insurance premiums to the value-added output of the agricultural sector should reach 1% by then, while each agricultural sector worker should contribute an average of RMB500 yuan (around US$70) in agricultural insurance premiums, the circular said.

By 2030, China aims to have its agricultural insurance system meet international standards, which will benefit agricultural industries, farmers, as well as insurance institutions.