Livestock Insurance Scheme

What is Livestock Insurance Scheme?

Livestock is one of the primary sectors in our country. A large proportion of the employment is served by the livestock sector. There are millions of animals, including, buffaloes, goats, and cows served under the livestock in our country. The uncertainties in the production of crops are recovered by the rearing of livestock done by the farmers. It also provides sustenance to them. The loss of animals and livestock due to unfortunate circumstances, like diseases and death may cause turmoil in the life of farmers and cattle rearers. Therefore, an authentic protection mechanism should be provided for the safety and security of animals.  

The Livestock Insurance Scheme was, therefore, developed in mind to provide a protective environment to the farmers as well as the cattle rearers. This scheme came into action during the years 2005-2006 followed by the year 2007 of the 10th Five Year Plan and the year 2008 of the 11th Five Year Plan. It was launched as a centrally sponsored scheme, across 100 specified districts of the nation. The handling of scheme is handed over to the  State Livestock Development Boards of each of the states, the exception being Goa where the scheme was not implemented. 

Livestock provides livelihood to two-third of rural community.

The major benefit of this scheme was to provide insurance to the farmers and rearers in case they lose their animals due to any unfortunate event, like death or accident. This scheme continually focused on the importance of insurance to attain improvement in terms of livestock security. It aimed at achieving qualitative improvement in terms of livestock products. Therefore, these two objectives formed the twin objectives of launching the livestock insurance scheme. 

The following overview can be used to understand the implementation details of the Livestock Insurance scheme : 

• The high-yielding cattle are provided insurance at a price equivalent to the maximum of their market price currently. 
• Every insurance value is associated with a premium value. The premium in this case is subsidized to roughly 50%.
• This subsidy amount is paid off by the Central government of the nation.
• At most two animals are being provided subsidies. 
• The subsidy to the livestock would be provided for a tenure of three years. 

Clauses for the Application of the Livestock Insurance Scheme:

The livestock insurance scheme developed to protect and safeguard the farmers and cattle rearers against the loss of their animals will be applicable in the following scenarios : 

• Contraction of a disease
• Natural accidents, for instance, earthquakes or floods
• Terrorist activities
• Riots
• Surgical operation 
• Strikes
• Accidental events
• Civil Commotion Risk 

Future Scope of the Livestock Insurance Scheme:

The scheme would be extended to include more livestock species and provide insurance to the ones herding them. Some of the livestock animals to be included are indigenous Cattle, Yak & Mithun.

Objectives of the Livestock Insurance Scheme are: 

• Growth and development of the poultry sector
• Encouraging risk management factors
• Encouraging skill-based training 
• Disseminating technology in order to cut down the cost of production
• Establishment of synergy and convergence 
• Focusing on the applied research areas of nutrition 
• Introducing innovation in terms of pilot projects
• Meeting infrastructure requirements for marketing and processing
• Controlling environmental pollution activities
• Promotion of food safety and quality efforts 
• Increasing the production quality of fodder seeds
• Encouraging the formation of small groups and associations of farmers and livestock owners.
• Encouraging the upgradation of livestock and their conservation
• Highlighting the issues and concepts of conservation of breed and efficient practices concerned in the field of animal husbandry.

Related Frequently Asked Questions and Answers:

1Q. Define Cattle Insurance.

Solution:

The loss of cattle encountered due to accidental events, which may occur due to fire, road accidents,

• Poisoning, for instance, snake bite
• Drowning of the cattle
• Fire or road accidents
• Strangulation 
• Electrocution

Cattle insurance provides a safeguard to the rural people due to the occurrence of these accidental events with their cattle. It protects the livelihood as well as safeguards the employment of the farmers. 

2Q. State some of the Benefits of Cattle Insurance.

Solution:

Some of the benefits of cattle insurance are : 

• Protection from financial loss and innumerable debt
• Loss of cattle 
• Employment at stake

3Q. State what is Insurance Risk.

Solution:

The insurance risk is the slight probability of the occurrence of something unfortunate or unexpected at any event of time. It occurs when some accidental events take place. The events may include the events of robbery or damage to personal belongings or some valuable items. It may also include the loss of life due to death or harm to individuals. 

4Q. What Does Livestock Insurance Cover?

Solution:

Livestock Insurance Cover includes the following mishappening : 

• The cost of expensive inventory lost 
• Repayment of farm loans in an easy and flexible way
• Damage to valuable property
• Accidents 
• Natural phenomena, like, floods or earthquakes
• Robbery
• Loss of income on harm to livestock