Crop and livestock insurance in Bhutan yet to take off

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People, young and old, and from various facets of life in the country insure their life with different insurance policies. However, when it comes to crop and livestock insurance, people, especially farmers don’t seem to even have an option. Of the two insurance companies in the country, only the Royal Insurance Corporation (RICB) is capacitated to provide such insurance. But since crop and livestock insurance is expensive, the company is of the view that the government should intervene by helping the farmers pay a certain amount of the insurance.

Almost every season, farmers losing thousands of acres of crops to natural disasters, pests and diseases become national headlines. Likewise, farmers are also never excused from wild predation of animals, coupled with diseases that also kill many.

Just recently, more than 500 poultry farmers in the country lost their source of income following the suspected feed contamination incident. And not even one of them had their birds insured. Amid such adversities, farmers say lack of insurance scheme piles up their plight.

According to a poultry farmer from Kilkhorthang Gewog in Tsirang, Jitendra Rizal said insurance companies only insure their structure and not the animals.

“If there is such an insurance scheme, not only people will insure their animals but it would be of immense help as well,” he said.

Nubi Gewog of Trongsa is one of the communities in the country that has been under the constant scrutiny of wildlife predation. Farmers there lose hundreds of cattle to wild animals. But so far, not a single one of them has insured the livestock.

According to farmers there, while farmers would land up paying a huge premium, depending on the number of cattle, they are of the view that the government could step in to help.

“If the government could contribute to the insurance payment, I think we would be able to pay our part and get compensated during the loss,” said Tshagay Chewa, a farmer from Nubi Gewog.

According to RICB, crop and livestock insurance is expensive and farmers won’t be in the position to pay the premium. They suggest that the government intervenes.

Chief Executive Officer of the company, Karma, said crop and livestock insurance even in the developed countries are supported by the state. By doing so, he said the asset is mainstreamed and made a product.

“In many cases, the state picks up more than 80 per cent of the premium. That is cheaper than providing hundreds and thousands of monetary compensations to the affected farmers,” he said.

If there is government intervention, the company said they are ready to provide the crop and livestock insurance scheme. Meanwhile, the government is discussing with the insurance company to either subsidise the premium amount or to help farmers pay a certain per cent of the premium.

“For subsistence farming, we have an endowment fund and not many would opt for insurance since the premium would be so high. So, we are discussing how these issues could be solved,” said Agriculture Minister, Yeshey Penjore.

As per the international findings, insuring assets greatly help achieve financial freedom. While crops and livestock are dear to farmers, insuring them against any threat could provide farmers with huge financial relief.

Samten Dolkar

Edited by Chayku

BBS, Bhutan