Food security is related to the national economy and people's livelihood, and the three major food crops of rice, wheat and corn are the confidence to stabilize China's rice bowl. The implementation of the three major grain crop full cost insurance and planting income insurance policies can help grain farmers effectively resist risks, protect their enthusiasm for growing grain, and protect farmers' "money bags".
Not long ago, the Ministry of Finance and other departments made it clear that from this year onwards, the policy of full cost insurance and planting income insurance (hereinafter referred to as "three grains and two guarantees") for the three major grain crops will be fully implemented across the country. From the pilot project in 2018 to cover the whole country in 2024, what development has the "three grains and two guarantees" policy undergone? How do grain farmers feel? After going to the whole country, what room is there for policy improvement?
All farmers who grow the three major food crops will benefit
"This year, Shaanxi's wheat full cost insurance is 900 yuan per mu, which is 400 yuan more than last year's wheat planting insurance." Recently, the staff of an insurance company in Qishan County, Baoji City, Shaanxi Province entered the village to explain the relevant policies of wheat full cost insurance to the villagers. At the premium of 27 yuan per mu, farmers only bear 20%, and the rest is subsidized by financial funds...... The generous agricultural insurance policy makes wheat farmers nod frequently, "we are more down-to-earth in our hearts when growing grain."
On May 11, the executive meeting of the State Council deployed the implementation scope of the full cost insurance and planting income insurance of the three major grain crops from large grain-producing counties to the whole country, further stabilize the income of grain farmers, and improve agricultural disaster prevention, mitigation and relief capabilities. This expansion will benefit all farmers who grow the three major food crops in the country.
What is Full Cost Insurance and Cultivation Income Insurance? Why should the central and local governments subsidize the premiums of insured farmers for the implementation of full-cost insurance and planting income insurance policies?
It is understood that the benefits of agricultural production are approximately equal to income minus costs. Among them, the income is mainly determined by the two major factors of price and output, and the cost includes the loss caused by physical and chemical costs, land costs, labor costs and disasters. Fluctuations in the above factors are agricultural risks. Full cost insurance is agricultural insurance that covers the total cost of agricultural production such as physical cost, land cost and labor cost, etc., with the insured amount; Planting income insurance is an agricultural insurance whose insurance amount reflects the price and output of agricultural products and the level of protection covers agricultural planting income.
In agricultural production, due to the fact that agriculture is susceptible to large-scale natural disasters, the probability of agricultural insurance is large, the willingness of farmers to participate in insurance is low, and the operating efficiency of the insurance institutions is not high, and the purely commercial agricultural insurance is difficult to sustain, and it is necessary to provide financial support for agricultural insurance. In addition, replacing direct subsidies with policy-based agricultural insurance can also provide reasonable protection for agricultural production under the framework of WTO rules.
In the past few years, the coverage of the "three grains and two guarantees" has been expanding. From 2018 to 2020, China piloted the "Three Grains and Two Guarantees" policy in 24 counties in six provinces. In 2021, the implementation scope of the "Three Grains and Two Guarantees" policy will be expanded to about 500 major grain-producing counties in 13 major grain-producing provinces; In 2022, the policy will cover all about 800 major grain-producing counties in these 13 provinces; In 2023, the policy will cover all about 1,100 major grain-producing counties in China, and the central government will allocate 47.8 billion yuan in subsidies for agricultural insurance premiums and provide 4.5 trillion yuan of risk protection for 160 million rural households.
According to a relevant responsible person of the Ministry of Finance, the output of the three major staple grains of rice, wheat, and corn accounts for about 90 percent of China's total grain output, and the sown area accounts for about 80 percent. From 2018 to 2020 to 2020, to 2021 to 2023 to formally implement and gradually expand the scope of policy implementation to all major grain-producing counties in the country, the "three grains and two guarantees" policy has been carried out for 6 years, in terms of risk prevention, underwriting claims, farmers' acceptance and other aspects have been relatively mature, in improving the level of insurance protection, improving farmers' enthusiasm for growing grain, and promoting moderate-scale operations.
Higher level of risk protection Why is it important to "three grains and two guarantees"?
Judging from the experience of the major agricultural provinces and grain-producing counties that have taken the lead in the pilot projects, the "three grains and two guarantees" have given full play to the role of "stabilizers" in grain production. In 2023, Henan Province will comprehensively promote the full cost insurance of the three major grain crops, of which the compensation expenditure for wheat will reach 2.905 billion yuan and the compensation expenditure for corn will reach 1.190 billion yuan, a year-on-year increase of 28.65%. By the end of 2023, the insurance coverage rate of the three major grain crops in Shandong Province will reach 93%, and 94 major grain-producing counties in the province will achieve full cost insurance coverage of the three major grain crops. Heilongjiang Province's "Three Grains and Two Guarantees" has covered 72 major grain-producing counties in the province.
After covering the whole country, how will the "three grains and two guarantees" policy be implemented?
In terms of subsidy schemes, the premium subsidy ratio of "three grains and two guarantees" is: on the basis of the provincial financial premium subsidy of not less than 25%, the central government subsidizes 45% for the central and western regions and the northeast region; On the basis of not less than 10% of the premium borne by the relevant central units, the premium subsidy of the relevant central units by the central government shall be implemented according to the subsidy ratio of the place where the planting business is located. In principle, the protection level of the two types of insurance shall not be higher than 80% of the output value of the corresponding variety. Specific crop varieties and insurance products are determined in combination with the actual situation of grain planting and the characteristics of agricultural products in the grain growing areas of the country.
In terms of insurance solutions, the insurance liability of full-cost insurance covers the risks of major local natural disasters, major pests and rodents, accidents, and damage to wild animals, while the insurance liability of planting income insurance covers the loss of income caused by fluctuations in the price and output of agricultural products. The insurance premium rate is determined according to the principle of guaranteed capital and small profits. The underwriting institution shall standardize the cost expenditure to ensure that the comprehensive cost rate of agricultural insurance is not higher than 20%. The insurance regulatory authorities should supervise the underwriting institutions to strengthen the management of underwriting claims, and ensure that the insurance is underwritten, the damage is assessed, and the claims are settled to the households for moderately large-scale farmers and small farmers.
For the peasants who grow the "three grains," the "two guarantees" are of great significance.
The relevant person in charge of the Ministry of Finance said that with the rapid development of moderately large-scale agricultural operations, the demand for risk protection of farmers is growing. "From the perspective of post-disaster compensation, which farmers are most concerned about, compared with traditional physical cost insurance, farmers who insure full cost insurance or planting income insurance have received a significant increase in compensation after the disaster, and the benefits are more obvious. Previously, the policy was implemented in all major grain-producing counties in the country, and there were strong calls for grain farmers in other regions to enjoy the same policy. The person in charge said.
According to the analysis of industry insiders, compared with traditional insurance types such as physical cost insurance and price index insurance, full cost insurance covers all production costs such as physical cost, land cost, and labor cost, which improves the degree of protection for the income per unit area of crops; Crop income insurance can protect both price and yield fluctuations, which is more comprehensive and easier to trigger claims, which can significantly increase the amount of compensation received by insured farmers.
Li Xiaofeng, associate professor of the Department of Finance of the College of Economics and Management of China Agricultural University, said that the insurance amount of full-cost insurance can cover the total cost of agricultural production, and the protection level can reach up to 80% of the planting income of the corresponding variety, while the maximum protection level of traditional physical and chemical cost insurance is less than 50%.
"The insurance liability of full cost insurance is wider, which can effectively solve the worries of farmers about growing grain. At the same time, this insurance includes moderately large-scale farmers and smallholder farmers into the scope of protection, expanding the group of beneficiary farmers and improving the inclusiveness of risk protection. Li Xiaofeng said.
The central government has arranged a premium subsidy budget of 56.2 billion yuan
According to the data, at present, the depth of China's agricultural insurance (premium scale/added value of the primary industry) exceeds 1.5%, and the density of agricultural insurance (premium scale/agricultural employment population) exceeds 700 yuan/person. While continuing to expand coverage, agricultural insurance will also further improve quality and efficiency.
Financial support will continue to provide an important guarantee for the development of agricultural insurance. This year, the central government has arranged a budget of 56.2 billion yuan for agricultural insurance premium subsidies, a year-on-year increase of 18%, providing strong support for the full implementation of the "three grains and two guarantees" policy across the country. The executive meeting of the State Council held not long ago also pointed out that it is necessary to strengthen departmental coordination, allocate premium subsidies in full and in a timely manner, strengthen fund supervision, and prevent arrears, withholding, and misappropriation of subsidies. At the same time, we will guide underwriting institutions to optimize the design of insurance types and claim settlement services, so as to ensure that once an accident occurs, it can quickly settle claims and make full claims, so as to effectively enhance farmers' sense of gain.
The relevant person in charge of the Ministry of Finance said that it will study and formulate comprehensive guidance to further promote the high-quality development of agricultural insurance, "in accordance with the idea of 'central development of bulk and local development characteristics', reasonably plan the priority of agricultural insurance development, and ensure the three major staple grains and other major bulk agricultural products and important materials related to the national economy and people's livelihood."
Relevant departments such as finance, agriculture and rural affairs, insurance supervision, forestry and grassland, and the insurance industry will strengthen coordination and cooperation, guide underwriting institutions to improve their grassroots service capabilities, and promote agricultural insurance to better play the role of supporting agriculture, benefiting agriculture and strengthening agriculture. At the same time, we will optimize the catastrophe risk diversification mechanism, strengthen the coordination of insurance and emergency management mechanisms, and give full play to the role of insurance market mechanisms and leverage, so as to reduce the government's disaster relief pressure.
In terms of improving the quality and efficiency of insurance services, the Ministry of Finance will cooperate with relevant parties to further clarify the claim settlement standards, standardize the investigation and assessment of losses, optimize the compensation model, increase the empowerment of science and technology, and reasonably advance compensation and make quick compensation; Supervise and urge insurance companies to design terms in an easy-to-understand manner, improve farmers' financial quality and insurance awareness, and improve farmers' sense of access to and satisfaction with grain farmers' policies.
"At present and in the future, on the basis of steadily expanding the area, increasing products and upgrading standards, the Ministry of Finance will work with relevant parties to continue to promote the quality and efficiency of agricultural insurance in the mainland from the perspective of improving the income guarantee mechanism for grain farmers." The relevant person in charge of the Ministry of Finance said.
Source: Xinhua News Agency