Download RUBBER PLANTATION INSURANCE

RUBBER PLANTATION INSURANCE
Rubber is one of the important cash crops cultivated in India mainly in Kerala and the NorthEastern States. The total area under rubber cultivation in the country is in the region of about 5,
74,000 hectares out of which 83% i.e. almost 4,78,500 hectares are in the state of Kerala.
The rubber plantations can be categorized into two types i.e. those with immature plants and
others with mature trees. A rubber plant takes almost 7 years of growth to mature for tapping
and start yielding. A mature healthy tree can be tapped for about 22 years. When the yield starts
decreasing beyond a certain level due to aging, the trees are usually cut and the area replanted.
The period of effective yield can vary from 16 to 22 years.
The rubber plantations are exposed to perils like fire, lightning, forest fire, bush fire, flood,
storm, tempest, inundation, land slide, rock slide, earthquake, drought etc. The peculiarity of
rubber plantations is that if a few trees in a holding is damaged or perished, that particular
patch of land cannot be used till the time the entire trees are cut and the area replanted.
Insurance Scheme for Rubber Plantations:
The scheme is applicable to both mature and immature plantations. The policy is issued for a
period of 7 years from the last day of the month of planting for immature plants. Compensation
will be available from the second year onwards, which is calculated on the basis of ‘replacement
cost of the plant plus present value of future returns arising out of the loss / death of the plant’.
For mature plantations, cover will be provided for blocks of 3 / 2 / 1 year(s) from the 8th year of
planting. Compensation is calculated the same way as for the immature plantations, i.e. taking
into account the input cost and anticipated yield deducting there from recurring maintenance
expenses. Maximum compensation is available during the age band of 8 to 13 years ( 5,00,000
per hectare) followed by 14 -19 years ( 4,00,000 per hectare); 20 - 22 years ( 3,00,000 per
hectare) and 23 -25 years ( . 2,00,000 per hectare).
Risks Covered by the Scheme:
Fire, Lightning, Riot, Strike & Malicious Damage, Bush Fire, Forest Fire, Flood, Storm, Tempest,
Inundation, Land Slide, Rock Slide, Earthquake and Drought provided the Block /Taluka
concerned is declared as drought affected by the competent authority of the State Government.
The policy is also extended to cover the loss or damage caused by road/rail/vehicles and wild
animals. Losses due to diseases and insect-pest are excluded from the scope of cover.
Period of Insurance:
Seven years from the last day of the month of planting for immature plantations and in blocks
of 3 / 2 / 1 year(s) each from the 8th year onwards upto 25 years for mature plantations.
Total Loss
In the case of destruction of 75% of trees and above per hectare, the loss will be treated as total
and the insured will be paid compensation as per the policy. Compensation for the remaining
unaffected trees in the affected holding will be paid on production of a certificate from the
Rubber Board / Surveyor certifying that the balance trees have been cut and that the entire land
is ready for re-planting.
Partial Losses:
Losses other than Total Loss will fall under Partial Loss category.
Partial losses due to perils covered by the policy will be clubbed during the monsoon months
(three months period from June to Aug) & will be treated as one loss.
Note: The above product summary is meant for information only and may not necessarily match the
actual insurance policy/scheme, word to word.