1. The Current Situation of Agricultural Insurance in my country Our country is a traditional agricultural country, with rural population accounting for 85% of the total population.

Among the economic components of our country, the rural economy occupies an important position.

Our country is also one of the countries with the most serious natural disasters in the world. Therefore, it is particularly important to transfer the huge risks in agricultural production and protect the lives, property and economic results of farmers from unexpected losses.

Since my country's social security system is not yet perfect, the current natural disaster relief channels in rural areas mainly rely on national fiscal transfer payments, and the proportion of commercial insurance relief is very low.

In economically underdeveloped areas, rural commercial insurance has not yet been covered.

Since the resumption of agricultural insurance business in 1982, my country's agricultural insurance has been in a sluggish state for a long time.

In recent years, my country's insurance industry has developed vigorously, and the imbalance in the development of agricultural insurance has become increasingly prominent.

From 1992 to 2004, agricultural insurance premium income dropped from 817 million yuan to 396 million yuan. By 2004, the per capita premium was less than 0.5 yuan.

From 1985 to 2004, the loss rate of agricultural insurance has remained high, with the comprehensive loss rate as high as 120%, far higher than the 70% profit critical point recognized by the insurance industry.

Under this circumstance, in order to promote the development of agricultural insurance, the central government has issued six consecutive "No. 1 Documents" since 2004, emphasizing the importance of policy-based agricultural insurance pilots.

The development situation of agricultural insurance in our country is grim, and it has reached a point where it is necessary to accelerate its development.

2. Main Problems in Agricultural Insurance The reasons for the slow development of agricultural insurance mainly lie in relevant policy factors, the attitudes of local governments and insurance companies, and farmers' awareness of this.

(1) Farmers have low income and lack the enthusiasm to participate in insurance.

In the past few years, due to oversupply and falling prices of many agricultural products, farmers' income from agriculture has decreased. It is particularly difficult for pure farmers who are mainly engaged in agriculture to increase their income.

In 1997, the per capita net income of farmers from agriculture was 1,268 yuan. From 2003 to 2009, the net income of farmers from agriculture was lower than this level for six consecutive years.

With such a low level of income, apart from the various taxes and fees that must be paid, living expenses, children's education expenses, and the purchase of fertilizers, pesticides, feeds and other necessities, each farmer's truly disposable income is very little.

.

Having to pay another agricultural insurance premium is obviously unacceptable to most farmers.

At the same time, due to strict control over the scale of agricultural insurance and complicated operations, the two parties often have large differences in opinions when it comes to compensation valuation. Some farmers who originally wanted to participate in the insurance often chose to give up because of this.

In addition, in the 1980s, farmers paid pensions at social security stations, but in the end they did not receive effective protection. This also made some farmers lack confidence in insurance and therefore were not enthusiastic about participating in insurance.

(2) Insurance companies lack strength and traditional agricultural insurance is unsustainable.

Agricultural insurance is a kind of insurance that depends on the weather. Often, one disaster year can eat up the fund accumulation of the past few years.

The proportion of agricultural disasters in China is about more than 40% every year, which is 10%-20% higher than that in other developed countries.

In recent years, China's agricultural losses due to natural disasters have been approximately 12.5 billion yuan each year, while the world average is only about 50 billion yuan per year, which means that China accounts for 1/4 of the total.

Agricultural insurance is a type of insurance with low fees, high risks, and high loss ratio. The break-even point is 65% to 70% capital preservation.

The large scale and unpredictability of natural disasters and epidemic outbreaks make it technically impossible for insurance companies to avoid risks, and the premiums collected are insufficient to maintain compensation payments.

Therefore, the risks of operating agricultural insurance are much greater than those of other current property insurance products.

If the insurance company is not strong enough, it will be difficult to operate agricultural insurance, so there are only a handful of insurance companies developing agricultural insurance.

Currently, only two companies, PICC Property and Casualty Insurance Company and China United Property and Casualty Insurance Company, offer agricultural insurance, and due to perennial losses, their business is also shrinking sharply.

(3) The support provided by the state finance is insufficient.

Agricultural insurance is different from disaster relief provided by the civil affairs department, and also different from general commercial insurance. It not only involves rural income redistribution, but also requires it to be consistent with the government's policy objectives.

At present, the government only provides business tax exemption for agricultural insurance, which is obviously not enough.

The state should introduce relevant laws and policies as soon as possible and increase financial subsidies so that insurance companies can truly see the benefits.

Only when commercial insurance companies see the benefits of agricultural insurance can they spontaneously develop the market. However, the current agricultural insurance market is unprofitable.

In this case, without higher government subsidies, property insurance companies will not voluntarily enter the industry, and those who have already entered will gradually have the idea of ??abandoning this part of the business.

Agricultural insurance is a socialized systematic project, and its basis should be government action.

China's agricultural insurance has developed to an "embarrassing" stage.

Commercial insurance has proven to be unsuitable for China’s relatively decentralized, family-based “small-scale agricultural” production method, so the country must “cover the bottom line.”

Relevant departments should introduce relevant supporting policies as soon as possible. Otherwise, the development of agricultural insurance will only remain at the stage of "calling and shouting".

(4) The moral hazard of agricultural insurance is relatively high.

Our country's agriculture is based on family production, the operation is relatively decentralized, and it is more prone to moral hazard.

Therefore, the underwriting procedures of agricultural insurance are also relatively complicated, and the costs of investigation and claims are high.