Kathmandu. Sagarmatha Lumbini Insurance Company Limited in technical collaboration with Plant Sat has launched an index-based milk production insurance policy to provide protection to farmers against possible losses due to decrease in milk production of cows and buffaloes due to increase in temperature.
According to Chief Executive Officer Chunky Chhetri, the insurance policy will be calculated on the basis of the maximum temperature for 150 days from April 21, 2083 to September 14, 2083 targeting the farmers, groups and cooperatives of Kanchanpur, Kailali, Bardiya, Banke, Dang, Kapilvastu and Chitwan districts.
So far, a total of 1,627 cows and buffaloes have been included in this insurance scheme, including farmers of various cooperatives and groups. This insurance policy approved by the Nepal Insurance Authority has been re-insured by Nepal Re-Insurance.
This policy is based on the stress caused by the temperature and will only cover the decrease in milk production of cows and buffaloes due to temperature. Founder and CEO of PlantSat, Suman Ghimire, said that the compensation will be given only if the actual temperature is above the limit set on the basis of the temperature record in the insurance policy and the compensation will be determined according to the predetermined level.
According to Umesh Dhaka, chief of Agriculture Department of Sagarmatha Lumbini Insurance Company Limited, the insurance policy determines whether the farmers are eligible for claims through an index-based trigger system.
The insurer will start the claim process once the official temperature data received from the Department of Hydrology and Meteorology is used and the claim reaches the trigger level. Subhash Dixit, head of the claim department, said that the payment will be sent directly to the bank account of the beneficiary farmers through electronic means within 7 days of receiving the index from the concerned authority.
