Tobacco Company Buys Insurance for Tobacco Production

Source from:  Chongqing City 07/07/2005

Southwest China's State-run Chongqing City Tobacco Company has reached agreement with the local subsidiary of China Union Property Insurance Company to provide insurance against natural disasters in tobacco production in Chongqing City. A major tobacco-producing region in China, Chongqing City is vulnerable to natural disasters. The frequent occurrence of natural disasters over the past few years has contributed to turning tobacco production in the city into a high-risk business and hindering steady development of tobacco production in the region. In an effort to lower risks against tobacco production, provide guarantee for compensation for possible losses in tobacco production in the region, and arouse the enthusiasm of local farmers for growing tobacco, Chongqing City Tobacco Company, which doubles as the local tobacco monopoly administration, has instructed its subordinate Chongqing City Leaf Tobacco Production, Purchase and Sales Company to take out an insurance policy for tobacco production in the region. According to the insurance policy, Chongqing City Leaf Tobacco Production, Purchase and Sales Company will pay part of the insurance premium for the four poorest local districts while its branches in the other districts of the city will pay the rest. Once a natural disaster occurs and causes damage to tobacco production, the insurance company will evaluate the damage, determine the size of compensation payable and make compensation to the beneficiaries. The insurance policy covers field losses causable by hailstorms, floods, winds and landslides as well as pests and plant diseases. Enditem