Kathmandu. Vietnam’s Ministry of Finance has recommended a significant increase in the agricultural insurance premium subsidy level. This is because the actual implementation of such insurance coverage shows that the participants are mainly the participating poor and almost the poor families.
According to the ministry’s draft order amending the agricultural insurance rules, people classified as poor families can receive subsidies of up to 95% (above 90%) of their insurance premiums, according to a report published on Vietnamese news platform vneeconomy.vn.
Those not classified as predominantly poor or almost poor households will receive a 50% subsidy (up from 20% currently) and agricultural production institutions will receive a 30% subsidy. In addition, the ministry has proposed to allow them to include regionally specific crops, animals and aquatic products in the insurance scheme. The current scheme will cover crops (rice, rubber, pepper, cashew, coffee, fruit trees, vegetables), animals (buffalo, cow, pig, chicken) and aquatic animals (tiger shrimp, whiteleg shrimp, catfish).
Further, under the proposed new rules, the ministry will allow lending institutions to provide loans to agricultural production institutions and individuals to pay insurance premiums, in addition to the share of insurance premium subsidized from the state budget. “The insurance agreements can be considered as collateral for loans, especially if the parties concerned agree,” the ministry said. ’
With these changes, the Vietnamese government aims to expand the coverage and attractiveness of agricultural insurance. “This increases the risk tolerance of agricultural products and achieves social welfare goals,” the ministry said, adding that at present, only three of the branches and 31 insurance companies of foreign non-life insurance companies participate in the government’s agricultural insurance support scheme. These units are also doing so cautiously, prioritizing efficiency and risk control. —Agency
