China Banking and Insurance News: 

My question is about agricultural insurance. What measures has the NFRA taken in recent years to promote agricultural insurance, serve agricultural production and standardize the development of agricultural insurance? What policy initiatives will be introduced going forward to promote the high-quality development of agricultural insurance? And, in response to current meteorological changes, what innovations will be developed in agricultural insurance products? Thank you.

Yin Jiangao:

Thank you for your question. Agricultural insurance is a crucial means to safeguard agricultural production. In recent years, the NFRA has been focusing on promoting the transformation and upgrading of agricultural insurance, enhancing its protection and service capabilities, and has achieved positive progress. In the first half of this year, agricultural insurance payouts amounted to 47.5 billion yuan, an increase of 5.1% year on year, benefiting 16.26 million rural households. Here are some key points:

We have focused on "expanding coverage, increasing varieties and raising standards" to broaden the scope of agricultural insurance and enhance its protection levels. This year, we have extended comprehensive cost insurance and planting income insurance for the three main grains — corn, wheat and rice — to all regions across the country. According to estimates, this has added approximately 400 billion yuan in insurance coverage for agricultural production nationwide. At the same time, we have added local specialty agricultural insurance products, such as comprehensive cost insurance and planting income insurance for sugar cane in Guangxi Zhuang Autonomous Region. Given the significant differences in agricultural production across the country, there is still considerable room for exploration in local specialty agricultural insurance.

We have promoted the standardization of agricultural insurance business and strengthened the protection of farmers' interests. We have introduced the Agricultural Insurance Underwriting and Claims Management Measures and the Agricultural Insurance Actuarial Regulations. We have also released the industry benchmark pure risk loss rate table for the cost insurance of the three main grains at the prefecture-level, primarily to support differentiated pricing in various regions. Additionally, we have arranged special annual inspections of agricultural insurance, strictly investigating and dealing with illegal and non-compliant activities, to promote business standardization.

We have strengthened the standardization of agricultural insurance, promoting the improvement of management and operational levels. We have organized the industry to compile service specifications for underwriting and claims in planting insurance, livestock insurance and forest insurance, and guided the industry to develop the Agricultural Insurance Product Development Guide, releasing model clauses for insurance of the three main grains, among others. Overall, we have achieved positive progress.

To promote the construction of an agricultural powerhouse, agricultural insurance must play a more pivotal role. For example, last year, China's added value of agriculture was approximately 9 trillion yuan, ranking first globally. During the same period, the amount of protection provided by agricultural insurance in China was around 5 trillion yuan, suggesting ample room for growth. Next, we will deepen the reform of agricultural insurance, broaden its service areas, and serve the high-quality development of agriculture. We will build a multi-level agricultural insurance product system, extending from protecting replacement costs to protecting economic value, and enhance the level of agricultural insurance protection. We will also promote the introduction of pure risk loss rates for major insurance types, industry model clauses for comprehensive cost insurance and planting income insurance, and precise policy documents for underwriting and claims, to promote the standardized operation of agricultural insurance.

In terms of climate change, we will also guide insurance enterprises to respond proactively and gradually launch innovative pilot projects such as weather-based index insurance and regional yield insurance. We will promote the gradual transformation of agricultural insurance from cost protection to income protection. We will also expand from covering only the production stage to covering the entire industrial chain. This will gradually form a comprehensive insurance protection system for agricultural development. Thank you.