The Vietnam Bank for Agriculture and Rural Development (Agribank) has said it is planning to submit an agriculture insurance project to the government, under which all compensation will be paid by Swiss Reinsurance.
Do Minh Hoang, Acting General Director of the Agribank Insurance Joint Stock Company (ABIC) which created the project, said total losses caused by natural disasters and epidemics in the agricultural sector account for 1.5 percent of the country’s GDP each year. With such a high risk, many domestic insurers, including ABIC, can not pay the damages, he added.
For this reason, Agribank proposed the transfer of agriculture insurance abroad through its partner Swiss Reinsurance – whose capital is 30 times higher than that of Agribank, with an operation network that extends to 160 countries and territories around the world. “Therefore, natural disasters and epidemics on whatever scale are all within the possibility of insurance,” Hoang stressed.
Under the project, ABIC will offer agricultural insurance products to farmers and then resell the original insurance policies to Swiss Reinsurance.
The Swiss group sent experts to assist ABIC in designing agriculture insurance products. One of the planned products is drought index agriculture insurance.
According to Agribank , Vietnam currently has 13 million farm households. Of that number, 10 million are the bank’s potential clients, 2 million are living just above the poverty line and are potential customers of the Social Policy Bank and the rest are already customers of 100 or so other finance institutions and banks.
Over the past two decades, 1.8-1.9 percent of farm households have taken out loans but have failed to pay their debts./.
Do Minh Hoang, Acting General Director of the Agribank Insurance Joint Stock Company (ABIC) which created the project, said total losses caused by natural disasters and epidemics in the agricultural sector account for 1.5 percent of the country’s GDP each year. With such a high risk, many domestic insurers, including ABIC, can not pay the damages, he added.
For this reason, Agribank proposed the transfer of agriculture insurance abroad through its partner Swiss Reinsurance – whose capital is 30 times higher than that of Agribank, with an operation network that extends to 160 countries and territories around the world. “Therefore, natural disasters and epidemics on whatever scale are all within the possibility of insurance,” Hoang stressed.
Under the project, ABIC will offer agricultural insurance products to farmers and then resell the original insurance policies to Swiss Reinsurance.
The Swiss group sent experts to assist ABIC in designing agriculture insurance products. One of the planned products is drought index agriculture insurance.
According to Agribank , Vietnam currently has 13 million farm households. Of that number, 10 million are the bank’s potential clients, 2 million are living just above the poverty line and are potential customers of the Social Policy Bank and the rest are already customers of 100 or so other finance institutions and banks.
Over the past two decades, 1.8-1.9 percent of farm households have taken out loans but have failed to pay their debts./.
