December 2: Non-life insurance companies will now have to mandatorily cover a minimum of 5 percent insurance for the agriculture sector from its total annual business. This provision has come into force after the Insurance Board issued the Agriculture and Livestock Insurance Directive 2077 on Monday (December 1).
According to the Insurance Board, this new provision will be implemented from the current fiscal year.
The directive mentions that insurance companies must cover 5 percent insurance for the agriculture sector from its annual sales of insurance policies. The board officials said that they made such provision due to lacklusture approach of insurance companies toward agriculture insurance.
The Insurance Board has classified agriculture insurance into to categories, namely vegetation and livestock insurance. Insurance companies can also issue short-term insurance policies from now onward.
The new directive also has a provision for a technical expert to be present while covering agriculture insurance. The technician is entitled to receive 5 percent commission from the insurance amount.
From now on, insurance companies cannot fix the insurance amount for a particular product based on assumption or approximate value. They will also have to keep digital records by taking pictures and videos, the new directive states.
The new directive also has a provision for surveyor for evaluation who has a minimum of proficiency certificate level degree and has taken permission from the board for the survey. The directive states that the remunerations of the surveyors can be determined by the insurance companies.