Muscat: Farmers in Oman can expect insurance coverage for their agricultural cultivation as a committee chaired by the stock market watchdog is about to finalise a policy for such an insurance scheme.
A committee with members from the Capital Market Authority (CMA), the Oman Chamber of Commerce and Industry, the Ministry of Agriculture and Fisheries and insurance companies has been discussing various aspects to frame such a policy as well as the feasibility of such a scheme.
Insurance firms will be able to come up with special insurance schemes for agricultural and fisheries sectors for the first time in the country.
Risks faced by farmers
“We hope to come up with a policy that covers the risks faced by farmers. The insurance companies have evinced interest as well,” Abdullah bin Salim Al Salmi, executive president of the Capital Market Authority, told the Times of Oman.
Like other developing countries, Oman needs insurance for its farmers to mitigate the risks posed by droughts, locust attacks and other plant diseases, which reduce farmers’ income.
Majority of the holdings are tiny, and farmers are able to derive marginal surplus only in certain good years and incur heavy deficits in the bad ones.
After Cyclone Gonu and other tropical storms, farmers suffered major losses. Many farmers’ associations complained that their members were not covered for such damages.
Banks are also in a better position to provide agricultural loans if the crops are insured.
The CMA chief also noted that the committee is trying to come up with a new policy to cover agricultural cultivation, mainly certain crops grown in Oman. “We are progressing quite well on that front.”
The committee has so far held four meetings. The last of the meetings was held in January where various types of insurance coverage needed by the agricultural sector in Oman were discussed.
The team also discussed the challenges and obstacles facing insurance companies in providing coverage for crops and agricultural activities, livestock and fisheries.
The committee, according to an earlier report, will complete the study in the first quarter of 2017 and will discuss it in detail with the Omani Agricultural Association for feedback before submitting it to the authorities.