State subvention rate for agriculture insurance increased

The state will sub vent 50% of the insurance bonus for the majority of agricultural goods and 60% – of the strategic crops, having great incomes per square unit, such as fruit growing, viticulture, vegetable growing and sugar bit. A decision in this sense was adopted on Wednesday, 22 March by the cabinet. According to government decision, changing the quota of the co-balance between the state and the agricultural producers while results of the difficult financial situation of agricultural producers, caused by the essential increase of the price to producing resources, as well as oil, fertilisers, pesticides etc. In the same time, taking into account the increased cost for concluding insurance contracts, the authors of the decision proposed the increase up to 20% of the amount of insurance bonuses of the management expenses of the insurer. The practice of insurances of the risks in agriculture shows that while concluding the contracts the insurers do not include in the term to pay the insurance bonuses, as the main inflow of money of agricultural producers comes in November-December. That’s why; it was proposed to prolong the term for paying the insurance bonuses. Thus, for autumn crops and multi-annual crops payment of insurance bonuses will be made at latest on 1 December of the year previous to crops, according to note accompanying the decision. This year, there are foreseen 15 million lei of the state budget for partly subvention on behalf of the state of the insurance bonus, compared to those 5 million lei last year. Previously, the state covered 40% of the insurance bonus, and agricultural producers covered the rest de 60%. Modification of the Law on subvention insurance of production risks in agriculture was approved by the parliament.