China News Service, June 29. According to the Ministry of Finance website news on the 29th, the Ministry of Finance, the Ministry of Agriculture and Rural Affairs and the China Banking and Insurance Regulatory Commission have recently jointly issued the "Notice on Expanding the Implementation Scope of Full Cost Insurance and Planting Income Insurance for the Three Major Food Crops" (hereinafter referred to as Notice), the notice mentioned that by expanding the scope of implementation of the three major food crops complete cost insurance and planting income insurance, the attractiveness of agricultural insurance products will be further enhanced, and the support and protection policy system and the rural financial service system in line with the characteristics of China’s agricultural development will be improved and stabilized. Farmers benefit from growing grain to support the development of modern agriculture and ensure national food security.

Data map: Wheat sickle scene.

Photo by China News Agency reporter Zhai Yujia

　　The notice pointed out that the subject of insurance is the three major food crops of rice, wheat, and corn that are related to the national economy, people’s livelihood and food security.

The types of insurance are full cost insurance and planting income insurance.

Among them, full cost insurance is agricultural insurance that covers the total cost of agricultural production such as direct materialized costs, land costs, and labor costs; planting income insurance is agricultural insurance that covers the price and output of agricultural products and covers agricultural planting income.

The insurance coverage targets all farmers, including farmers with moderate scale operations and small farmers.

　　The notice also pointed out that the implementation areas are major grain producing counties in 13 major grain producing provinces including Hebei, Inner Mongolia, Liaoning, Jilin, Heilongjiang, Jiangsu, Anhui, Jiangxi, Shandong, Henan, Hubei, Hunan, and Sichuan.

The number of implementing counties included in the subsidy scope in 2021 will not exceed 60% of the total number of major grain-producing counties in the province, and in 2022, full coverage of major grain-producing counties in the implementation area will be achieved.

The scope of major grain-producing counties in major grain-producing provinces is determined according to the list of major grain-producing counties awarded by the central government in the previous year.

　　According to the notice, in principle, the protection level of full cost insurance or planting income insurance is not higher than 80% of the planting income of corresponding varieties.

The total agricultural production cost, unit yield and price (land price) data shall be based on the latest "Compilation of National Agricultural Product Cost and Benefit Data" issued by the National Development and Reform Commission or the data recognized by relevant departments.

The subsidy ratio is based on the provincial fiscal subsidy not less than 25%, the central government subsidies 45% to the central and western and northeastern regions, and 35% to the eastern region.

　　In terms of insurance plans, the notice proposes that the insurance liability of full cost insurance should cover major local natural disasters, major plant diseases and insect pests and accidents, and the insurance liability of planting income insurance should cover the loss of income caused by fluctuations in agricultural product prices and output.

The insurance premium rate shall be determined in accordance with the principle of capital preservation and meager profit, and the comprehensive expense rate shall not be higher than 20%.

　　All localities should pay attention to strengthening the qualification management of underwriting institutions.

Insurance institutions that underwrite full cost insurance or planting income insurance should meet the relevant requirements of the ``Notice of the Ministry of Finance on Strengthening the Selection and Management of Policy-based Agricultural Insurance Underwriting Institutions'' (Caijin (2020) No. 128) and the China Banking Regulatory Commission on agricultural insurance Regulations on operating conditions.

　　The notice stated that underwriting agencies should formulate insurance clauses and premium rates in a fair and reasonable manner, and fully solicit opinions from local finance, agricultural and rural departments, and farmers’ representatives.

　　In addition, underwriting agencies should strengthen the management of underwriting claims, and for farmers and small-scale farmers with moderate scale operations, they must provide coverage, damage assessment, and settlement of claims to households.

It is necessary to study and formulate standards and norms for damage assessment according to local conditions.

Based on the agreement of the farmers, in principle, the loss rate can be determined by sampling in the unit of township or village.

Underwriting agencies must have sound agricultural reinsurance arrangements, actively participate in the pilot reform of the agricultural insurance reinsurance system, and ensure steady progress in expanding the scope of policy implementation.

　　The notice also stated that under the premise of complying with the guiding ideology and basic principles of expanding the scope of policy implementation, localities are encouraged to explore and carry out agricultural insurance innovation pilots based on actual conditions, develop standardized agricultural insurance products, improve risk zoning and premium rate adjustment mechanisms, and strengthen premium subsidy funds. Audit.

Encourage relevant parties to strengthen cooperation with the Major Special Engineering Center of the National Defense Science, Technology and Industry Bureau to cross-validate agricultural insurance data through remote sensing and other channels to improve the authenticity and accuracy.

　　The notice will come into effect on January 1, 2021.

``Notice of the Ministry of Finance on Launching the Pilot Program of Agricultural Catastrophe Insurance in Major Grain Producing Provinces'' (Caijin (2017) No. 43), ``Notice of the Ministry of Finance on Expanding the Scope of the Pilot Program of Agricultural Catastrophe Insurance'' (Caijin (2019) No. 90) ) Will be repealed from January 1, 2022.