GUIDELINES FOR IMPLEMENTATION OF LIVESTOCK INSURANCE SCHEME IN ODISHA UNDER STATE PLAN Livestock is an important sector of national economy, especially for the rural areas. The supplementary income derived from rearing of livestock is a great source of support to the farmers facing uncertainties of crop production, apart from providing sustenance to poor and landless farmers. For promotion of the livestock sector, it is important that along with providing more effective measures for disease control and improvement of genetic quality of animals, a mechanism of assured protection to the farmers and cattle rearers is required against eventual losses of such animals. In this direction, the Government of India introduced a Centrally Sponsored Scheme (CSS) on Livestock Insurance on a pilot basis during 2005-06 & 2006-07 in 100 selected districts of the Country. In Odisha, initially the said scheme was implemented in two district like Jagatsingpur and Cuttack districts on pilot basis which was subsequently extended to nine districts like including the above two like Sambalpur, Puri, Kendrapada, Keonjhar, Mayurbhanj, Khurdha, Bargarh. Presently, the scheme is being implemented in these nine districts under CSS and Orissa Livestock Resources Development Society (OLRDS) is the State Implementing Agency to implement the scheme in these nine districts. The Government of India was requested by the SIA to extend the scheme to remaining 21 districts of the State which is still under consideration. However, considering the usefulness and success of the scheme in our State in the course of its implementation during last two to three years, it was decided to take up the scheme in remaining 21 districts of the State under State Plan from the financial year 2013-14. However, the scheme under central assistance will be continued to take up in nine districts in usual manner as before. The broad guidelines, to be followed to implement the scheme under State Plan in 21 districts are detailed below: Implementing Agency The National Project for Cattle and Buffalo Breeding (NPCBB) is being implemented through the State Implementing Agencies (SIAs) like State Livestock Development Boards/ Agencies or Societies. In Odisha, OLRDS is the SIA for the Central Project, NPCBB. In order to bring about synergy between NPCBB and Livestock Insurance under CSS, the latter scheme is also implemented through the SIAs. Therefore, the LIS under State Plan will be implemented through the Orissa Livestock Development Society(OLRDS), Bhubaneswar under State Fisheries and Animal Resources Development Department.Executive Authority The Chief Executive Officer of OLRDS will be the executive authority for this scheme under State Plan. The CEO will have to get the scheme implemented in the selected districts through the senior most officer of the Animal Husbandry Department in the district by following the Government of India guideline issued for Livestock Insurance Scheme 2013-14. The necessary instructions for this purpose will have to be issued by the State Government. The funds for premium subsidy for insuring the animals, payment of honorarium to the Veterinary Practitioners, awareness creation through publicity with involvement of local Panchayat Raj institutes will be placed with the SIA. As Executive Authority of the scheme, the Chief Executive Officers will be responsible for execution, and monitoring of the scheme. The main functions of the CEO will be: - (i) Managing the funds placed under State Plan carefully and in accordance with instructions issued by the State Government. (ii) Calling quotations from the insurance companies for implementing the scheme, carrying out negotiations with them and selecting suitable company (companies). (iii) Signing the contract with the selected insurance company/companies. (iv) Payment of subsidy premium to the Insurance Company (including advance, if any and its subsequent adjustment). (v) Preparing district wise list of Veterinary practitioners (Government) and providing the same to the insurance company and also to concerned Panchayati Raj bodies. (vi) Creating awareness among the general public as well as the officials whose services may be required for implementation of the scheme. (vii) Carrying out field inspections and also facilitating field inspections by the authorities. (viii) Release of funds to the concerned Chief District Veterinary Officers for payment of honorarium to the Veterinary Practitioners. (ix) Regular monitoring and preparation of reports for submission to the State Government. (x) Furnishing village wise list of livestock owners who have insured their animals during the Financial year along with list of claimant and status of their claims. (xi) Such other functions necessarily required for efficient implementation of the scheme. The Department of Animal Husbandry and Veterinary Services will ensure availability of sufficient infrastructure in terms of manpower and other logistic support to the CEO & the concerned CDVO which is needed for effective implementation of the scheme. The name, designation, address of CEO and the concerned CDVOs for Insurance work will be made available to the Government. Any change in the name and designation of CEO or CDVOs will also be properly communicated to all concerned. For effective implementation and monitoring of the scheme a district committee could be formed suitably involving the officers / organizations having interest in the field of Animal Husbandry. The Dairy Cooperative Societies could also be involved and given responsibility of implementing the scheme wherever possible. Districts in which the scheme will be implemented The scheme is to be implemented in 21 selected districts of the State which are Angul, Balasore, Bolangir, Boudh ,Dhenkanal ,Deogarh ,Ganjam ,Gajapati , Jajpur ,Jharsuguda, Kalahandi, Koraput , Malkanagiri ,Nawarangpur ,Nuapada, Rayagada, Sundergarh, Sonepur, Nayagarh, Kandhamal and Bhadrak. Selection of Insurance Companies In order to get the maximum benefit in terms of competitive premium rates, easier procedures of issue of policy and settlement of claims, the Chief Executive Officer will be empowered to decide upon the Insurance company(s) and the terms and conditions. While selecting Insurance Company, besides premium rates offered, their capacity to provide services, terms and conditions and service efficiency should also be taken into account. The CEO will invite quotations in writing from those public and private general insurance companies having a fairly wide network in the State particularly in these 21 districts. The CEO should select the Insurance Company/Companies after negotiating with the insurance companies for successful and efficient implementation of the scheme and popularizing the scheme amongst the livestock owners. If any Insurance Company is offering cover for any type of disability in addition to death of the insured animal, such offer could be considered, however, no subsidy in the premium for such additional risk coverage will be provided. The entire cost of premium on account of the risk coverage other than death of the animal has to be borne by the beneficiaries. However, as per the GoI guideline, if any additional risk cover is offered as a package along with death cover and the premium rate is not exceeding the maximum limit of 4.5 % for annual policies and 12% for three year policies, such offer could be accepted and subsidy could be provided. As mentioned above, the CEO has to ensure that the premium rate agreed to is competitive. Under no circumstances, the rate of premium should exceed 4.5% for annual policies and 12% for three-year policies. Normally, a single insurance company should be entrusted for insurance with the work in a district. However, for the purposes of encouraging competition and popularizing the scheme more than one insurance company may be allowed to operate in a district, if other terms and conditions are remaining same. Default in settlement of claim or any types of deficiency in services on part of Insurance Companies could be brought to the notice of the Insurance Regulatory and Development Authority which is a nodal authority in the country in this regard. The Service Tax cannot be paid by the State Government, but by the entity, that is liable. Involvement of Veterinary practitioners The active involvement of the veterinary practitioners at the village level is required for the successful implementation of the scheme. They are to be associated with the work of identification and examination of the animals to be covered under the scheme, determination of their market price, tagging of the insured animals and finally issuing Postmortem Report as and when a claim is made. Besides, being in touch with the farmers and cattle-rearers, they may also help in promoting and popularizing the scheme. Only the Veterinary practitioners registered with the State Veterinary Council will be involved. A list of such Veterinary practitioners will be prepared for every district with the help of district officer of the Department and it will be made available to the insurance company selected for the district as well as to the concerned Panchayati Raj bodies. Commencement of Insurance policy cover and adjustment of premium subsidy In order to generate confidence among the cattle owners about the efficacy of the scheme, it is important that the policy cover should take effect once the basic formalities like identification of animal, its examination by the veterinary practitioner, assessment of its value and its tagging along with payment of 50% of the premium to the insurance company or its agent by the cattle owner are completed. The selected insurance company will have to agree to this. However, it is possible that the insurance company may point out a provision in the Insurance Act that insurance cover can take effect only after the whole premium is paid in advance. In order to take care of this problem, there could be an arrangement by which certain amount is paid in advance to the insurance company directly by the CEO. This amount should not exceed 50% of the premium of the number of animals expected to be insured in a period of 3 months. The insurance company, on its part, should issue instructions to their branches that as and when 50% of the premium is paid by the cattle owner, they should issue the policy by suitably adjusting the balance 50% from this advance. The insurance company should prepare monthly statements of the policies issued indicating the assessed value of each animal and the Government share for each district duly countersigned by the district officer of the Animal Husbandry Department and submit to the CEO so that, that much amount can be recouped to the insurance company by the CEO. Target of getting the number of animals insured in a three months period for payment of advance to the Insurance Company should be on realistic basis and recouping of the advance fund should be on the basis of subsequent progress made by the concerned Insurance Company. Animals to be covered under the scheme and selection of beneficiaries The graded indigenous/crossbred milch cattle and buffaloes will be under the purview of the scheme. Milch cattle/buffalo will include both in-milk and dry as well as pregnant animal, which have already calved once. Benefit of subsidy is to be restricted to two animals per beneficiary per household. Efforts will be made to insure the milch animals for at least three years rather than one year. This is administratively convenient and rates will also be significantly reduced. However, as evident from the past experiences, farmers were eager to go for one year policy rather than three year policy as the payment of premium amount for one year was comparatively less than the premium amount for three years. Hence, keeping this in view, if a farmer desires to have a policy for a period less than three years that could also be provided and subsidy on premium will be provided for insuring same animals again in the future years of implementation of the scheme. Special efforts will be made to associate and involve the registered milk societies/unions for insuring the milch animals belonging to the members of these societies/unions as a group. Field performance recording under the NPCBB for identification of elite animals may also be integrated with insurance. The Village Panchayats and the Panchayat Raj Institutions will also be involved in the identification of animals to be insured, promotion of the scheme and providing assistance for better implementation of the scheme Determination of market price of the animal An animal will be insured for its current market price. The market price of the animal to be insured will be assessed jointly by the beneficiary, authorized Veterinary practitioner and the insurance agent if engaged. Identification of insured animal The animal insured will have to be properly and uniquely identified at the time of insurance claim. The ear tagging should, therefore, be full proof as far as possible. The cost of fixing the identification mark will be borne by the Insurance companies and responsibility of its maintenance will lie on the concerned beneficiaries. The nature and quality of tagging materials will be mutually agreed by the beneficiaries and the Insurance Company. The Veterinary Practitioners may guide the beneficiaries about the need and importance of the tags fixed for settlement of their claim so that they take proper care for maintenance of the tags.Change of owner during the validity period of insurance In case of sale of the animal or otherwise transfer of animal from one owner to other, before expiry of the Insurance Policy, the authority of beneficiary for the remaining period of policy will have to be transferred to the new owner. The modalities for transfer of livestock policy and fees and sale deed etc required for transfer, should be decided while entering into contract with the insurance company. Settlement of Claims The method of settlement of claim should be very simple and expeditious to avoid unnecessary hardship to the insured. While entering into contract with the insurance company, the procedure to be adopted/documents needed for settlement of claim should be clearly spelt out. Only four documents would be required by insurance companies for settling the claims viz. FIR with the Insurance Company, Insurance Policy, Claim Form and Postmortem Report. All documents/forms for insuring as well as settling the claims should be made available by the insurance agency in local language and English language. In case of claim becoming due, the payment of insured amount should be made within 15 days positively after submission of requisite documents. While insuring the animal, the CEO must ensure that clear cut procedures are put in place for settlement of claims and the required documents are listed and the same is be made available to concerned beneficiaries along with the policy documents. The beneficiary should get full payment of the sum insured in case of death of animals. In case, there are delays in settling a claim or the claim is rejected, it must be fully justified by the concerned insurance agency to the claimant under intimation to SIA. Provisions to these effects must be incorporated in the MOU with the insurance agencies. Effective monitoring of the scheme In order to ensure full impact of the scheme, there is a need of strict monitoring at different stages. The monitoring should be in terms of financial releases, number of animals insured and type of insurance. Monitoring at the State and District levels is extremely important. The CEO will be required to make special efforts for effective monitoring. The Director Animal Husbandry & Vety. Services, Odisha will take periodic review of the implementation of the scheme. All Insurance Agencies will submit district-wise quarterly progress report for the policies in operation to Department of Animal Husbandry in the format given below by 15th of the next quarter.District No. of animals insured Total cases of claims made Total cases of claims settled Amount of premium received (Rs. Lakh) Amount of claim paid (Rs. Lakh) (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) In addition, they will also submit district-wise information on Claim ratios for the animals insured during a financial year (FY) latest by the 15th of April of the following FY after expiry of the said policies. State For annual policies For three year policies FY Premium rate * Claim ratio FY Premium rate Claim ratio (1) (2) (3) (4) (5) (6) (7) *including Service tax Payment of honorarium to the Veterinary practitioners As per the observations of Finance Department, the honorarium amount has been excluded from the project component. However this matter will be taken up separately with Finance Department highlighting equity aspects vis-s-vis Govt. of India funded Livestock Insurance Scheme. Publicity Wide publications will be made in the concerned districts for popularization of the scheme. The Panchayati Raj institutions will be involved in publicity. The task of disseminating information on the scheme and inviting farmers to offer their animals for identification for insurance will be entrusted to the Intermediate Panchayats. For this purpose the CEOs are empowered to provide assistance of Rs.10,000/- for each implementing districts to conduct district level orientation meeting involving various stake holders including district level official and Panchayati Raj members. Physical &Financial target of Livestock Insurance Scheme in 21 districts under State Plan (Rs. in lakhs) Planned Activity 2013-14 2014-15 2015-16 2016-17 Physical target Financial outlay Physical target Financial outlay Physical target Financial outlay Physical target Financial outlay Insurance coverage to the dairy animals 60,000 258.00 50,000 228.00 50,000 228.00 50,000 228.00
Posted on: Thu, 20 Mar 2014 07:42:12 +0000