Kathmandu. The agriculture insurance business has shrunk after the Ministry of Agriculture and Cooperatives implemented a new provision regarding the distribution of subsidy for agricultural crops and livestock insurance.
According to the data released by the Nepal Insurance Authority, the current fiscal year 2081. Income from agricultural insurance has shrunk by nearly 20 per cent by mid-April 2018. State-wise, except Koshi Province, the income of agricultural insurance has shrunk in all other provinces.
Karnali province has recorded the highest decline of 91.56 per cent, followed by Sudurpaschim (14.32 per cent) and Madhes (13.01 per cent). Although Koshi province recorded an increase of 5.66 percent, Lumbini 6.44 percent, Gandaki 0.31 percent and Bagmati 0.34 percent.
The biggest negative impact on agricultural insurance income has been seen in Karnali State. According to the NRA, the income from karnali has shrunk by 91 percent. The number of insurance policies has also decreased by 62 percent.
If the data released by the NRA is realistic, then the shrinking of agricultural crop insurance in remote areas like Karnali is a matter of concern or it may have brought out the real picture.
Overall, the amount of insurance premium has decreased by about 20 percent, but the number of insurance policies has increased by 7 percent.
According to the NRA, the non-life insurers have collected Rs 599.425 million by issuing the highest number of 55,905 insurance policies from bagmati state during the review period.
Recently, the government has made arrangements for subsidy according to the sum assured on the suspicion of misuse of agricultural insurance subsidy. The government has provided 80 per cent subsidy on insurance up to Rs 5 million, 65 per cent subsidy on insurance between Rs 5 million and Rs 10 million and up to 50 per cent on insurance above Rs 10 million. Earlier, the government had provided 80 percent of the amount in all types of insurance.
The government is in the coming fiscal year 2082. A budget of Rs 2.30 billion has been allocated for crop and animal insurance subsidy for 83.
