04 Oct Rice Farm Insurance in Indonesia, Help Farmers to Face Crop Failure Since 2015
Signing for rice farm insurance is full of benefits for farmers. Rice farm, as one of business in the agricultural sector, is faced with the risk of crop failures. This is caused by climate change such as floods, droughts, attacks by pests, and disease. This uncertainty could turn out to be a big loss for farmers at any time. Farmers who don’t have enough savings to cope with the loss are facing the risk of not being able to regrow their farms.
Asuransi Usaha Tani Padi (AUTP) program is an initiation by the Indonesian government in order to achieve the food self-sufficiency target. The rice production target for 2021 in Indonesia is 63.5 million tons. Agricultural Insurance is very important for farmers to protect their business. It’s a form of risk management where the participation of farmers in large numbers generates a lot of funds for compensation payments for farmers affected by the disaster.
Related to Indonesia’s government rice production target, you might want to read the reason why in The Concept of Food Security as the Global Awareness on Implementing Zero Hunger.
AUTP (Indonesian Rice Farm Insurance) Participation Criteria
AUTP aims to help farmers recover from their loss of crop failure. The given compensation is expected to be used again as a production fund for the farmer. There are certain conditions that a farm owner should fulfill to participate in AUTP.
To participate in AUTP, the farmer has to be a part of an agricultural group that owns up to 2 hectares of a rice field area. The farmer also needs to be an Indonesian citizen, and those who receive government aid, such as KUR, Sapras, Saprodi, will be prioritized. The rice farm should be a technical irrigated field, semi-technical irrigated, or simple traditional irrigation.
What Will AUTP (Indonesian Rice Farm Insurance) Cover
AUTP guarantees to compensate the rice harvest failure that’s caused by flood, drought, or pest attack. A flood in this case is the inundation of a field with a certain depth and period of time. It results in damage to the crops and reduces the level of crop production. The flood includes both floods caused by high rainfall and high tide.
Drought in this case means the field doesn’t receive the necessary amount of water over a period of time during the growing period, which results in suboptimal growing rates, damage to crops, and lower production rates. Lastly, pests are organisms that can interfere with and damage plant life or cause plant death, including certain types of plant pests and plant disease.
The coverage period under the AUTP program for each growing season begins on the estimated planting date and ends on the estimated harvest date. In AUTP, the insured price is set ad Rp6.000.000 per hectare of a growing season.
How to Register for the AUTP (Indonesian Rice Farm Insurance)
The registration can be done by using an application called SIAP. Participants should fill the digital registration form on the SIAP app. Their data will be assessed later. The insurance premium will be paid to the insurance manager’s company’s bank account.
The insurance policy is issued automatically through the SIAP application which contains the name of the farmer group and the name of the participating farmer. Notification of policy activation is delivered using a message blast through the registered phone number of the farmer group.
There are several indicators to monitor to estimate the success rate of this program in a region. The region should firstly accept the AUTP program target, and there is a farmer that’s willing to be the insurance participation. The farmer must get their compensation when crop failure happens, and the premium is distributed to participants in accordance with the applicable procedures for distributing rice farm insurance premium. The claimed funds also need to be used as a rice plant reproduction fund by the farmer. Monitoring is carried out by the Ministry of Agriculture, the Provincial Agriculture Service, and the Regency/City Agriculture Service in stages.