While the country is waiting for Government approval of a pilot agricultural insurance project, a model of livestock insurance fund in Son La province’s Moc Chau Dairy Cow Breeding JSC (MCDCB) has been successful, helping minimise risks for farmers.
Since starting operations in 2004, the livestock insurance fund now has a total investment of around 10 billion VND and is directly managed by breeders. When cows die of objective factors, breeders will be recompensed by the fund immediately.
According to MCDCB General Director Tran Cong Chien, the insurance premium for each cow is 500,000 VND but when the cow dies, the owner will be paid up to 8 million VND.
In addition to livestock insurance, the fund also insures milk price. Dairy breeders only pay an insurance premium of 50 VND per litre of fresh milk and when milk price drops by 25-30 percent compared to the insured price, they will be given 60 percent of the reduced price on each litre.
Nguyen Van Quang, one of the young billionaires on the Moc Chau Plateau, said that insurance for cow and milk price is considered a lifebuoy for breeders because when facing mishaps, they still have money to buy breeding animals for reproduction. He said that he took out insurance for his herd of more than 80 cows.
According to Hoang Kim Giao, Head of the Husbandry Department under the Ministry of Agriculture and Rural Development, insurance for livestock and milk price which has been applied in Moc Chau is the most successful agricultural insurance model of the Vietnamese husbandry sector so far.
The success is attributable to the close connection between breeders’ interests and the development of the business, he said.
Agricultural expert Prof. Nguyen Lan Hung stressed that this model should be expanded nationwide as currently, very few insurers dare to do it because they are afraid of facing losses as agriculture is an economic sector with a high risk level and big insurance payments.
Vietnam is also one of the ten countries hardest hit by natural disasters in the world and farmers, who account for 70 percent of the country’s population, are the most vulnerable. A lack of agricultural insurance policies can push farmers into poverty.
At present, Vietnam Insurance Corporation (Bao Viet) and France ’s Groupama Insurance Company have deployed agricultural insurance policies but with a small scale. Therefore, agricultural insurance premium revenues only account for a very small proportion in these companies’ total non-life insurance premium revenues.
The Vietnam Bank of Agriculture and Rural Development (Agribank) Insurance Joint Stock Company and the Ho Chi Minh City Insurance Joint Stock Corporation (Bao Minh) are speeding up procedures to join the agricultural insurance market./.
Since starting operations in 2004, the livestock insurance fund now has a total investment of around 10 billion VND and is directly managed by breeders. When cows die of objective factors, breeders will be recompensed by the fund immediately.
According to MCDCB General Director Tran Cong Chien, the insurance premium for each cow is 500,000 VND but when the cow dies, the owner will be paid up to 8 million VND.
In addition to livestock insurance, the fund also insures milk price. Dairy breeders only pay an insurance premium of 50 VND per litre of fresh milk and when milk price drops by 25-30 percent compared to the insured price, they will be given 60 percent of the reduced price on each litre.
Nguyen Van Quang, one of the young billionaires on the Moc Chau Plateau, said that insurance for cow and milk price is considered a lifebuoy for breeders because when facing mishaps, they still have money to buy breeding animals for reproduction. He said that he took out insurance for his herd of more than 80 cows.
According to Hoang Kim Giao, Head of the Husbandry Department under the Ministry of Agriculture and Rural Development, insurance for livestock and milk price which has been applied in Moc Chau is the most successful agricultural insurance model of the Vietnamese husbandry sector so far.
The success is attributable to the close connection between breeders’ interests and the development of the business, he said.
Agricultural expert Prof. Nguyen Lan Hung stressed that this model should be expanded nationwide as currently, very few insurers dare to do it because they are afraid of facing losses as agriculture is an economic sector with a high risk level and big insurance payments.
Vietnam is also one of the ten countries hardest hit by natural disasters in the world and farmers, who account for 70 percent of the country’s population, are the most vulnerable. A lack of agricultural insurance policies can push farmers into poverty.
At present, Vietnam Insurance Corporation (Bao Viet) and France ’s Groupama Insurance Company have deployed agricultural insurance policies but with a small scale. Therefore, agricultural insurance premium revenues only account for a very small proportion in these companies’ total non-life insurance premium revenues.
The Vietnam Bank of Agriculture and Rural Development (Agribank) Insurance Joint Stock Company and the Ho Chi Minh City Insurance Joint Stock Corporation (Bao Minh) are speeding up procedures to join the agricultural insurance market./.
