Agricultural insurance shelters farmers in grain belts (2)

Agricultural insurance, serving as a safety net, increases farmers' ability to manage risks and enables them to devote more resources toward higher-quality agricultural inputs, including farming equipment and seeds.

The Chinese government now shoulders 80 percent of agricultural insurance premiums. In Heilongjiang, every yuan paid by a farmer is subsidized by 0.75 yuan from the county government, 1.25 yuan from the provincial government and 2 yuan from the central government.

From 2007 to 2011, China's central government budget spent 26.4 billion yuan on agricultural insurance subsidies, according to the China Insurance Regulatory Commission.

"These subsidies have made agricultural insurance premiums affordable for a large group of farmers and have led to rapid growth in the Chinese agricultural insurance market," according to a report by Swiss Reinsurance Company (Swiss Re), one of the world's largest reinsurers.

For instance, agricultural insurance in Heilongjiang now covers almost half of the farmland in the province, but two years ago, only about 30 percent was insured, according to Heilongjiang Provincial Insurance Regulatory Bureau.

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