Bhutan is poised to introduce a significantly enhanced Rural Life Insurance Scheme (RLIS) before June 2026, marking a major step forward in strengthening the nation’s social protection framework, according to Finance Minister Lekey Dorji.
During the ongoing Parliament Session, National Assembly (NA) Member of Parliament (MP) Dorji Wangmo raised questions regarding the current status of the RLIS review. In response, Lyonpo Lekey confirmed that a comprehensive assessment of the scheme is underway, aligned with the budget allocation of Nu 263 million under the General Reserve for the fiscal year 2025–26. The objective is to improve coverage, increase benefits, and modernize Bhutan’s national life insurance system to make it more inclusive and sustainable.
“To oversee this process, a multi-sectoral Steering Committee has been established, comprising representatives from the Ministry of Finance, the Royal Monetary Authority, the GovTech Agency, the National Digital Identity (NDI) program, OCASC, and the Ministry of Home and Cultural Affairs,” the Minister explained. The Committee’s mandate is to review the existing framework and propose enhancements that balance the Government’s commitment to increasing benefit amounts with fiscal prudence and equitable distribution.
The review process centers on two primary priorities. First, the Committee is focused on increasing the benefit amount, in line with government pledges, while determining an appropriate structure for premiums and government subsidies. The second priority involves modernizing the social protection architecture so that the scheme remains universally accessible, with targeted support for households most in need.
To achieve this, the Committee is exploring an income–means-tested subsidy mechanism that can be delivered efficiently through technology platforms such as the National Digital Identity. “This approach ensures that the scheme remains universally available while public resources are allocated transparently and equitably,” Finance Minister said. However, he acknowledged that challenges persist, particularly due to the limited availability of comprehensive and reliable data, which has slowed the depth of analysis required for policy design.
Despite these hurdles, the Ministry expects the Steering Committee to submit its recommendations to the Lhengye Zhungtshog by the end of December 2025. With the anticipated passage of the Financial Services Bill during the current parliamentary session, the enhanced RLIS is expected to be operational before June 2026, providing much-needed financial security to rural households.
The scheme’s enhancement represents one of the government’s major social protection pledges. Among the most significant improvements is the increase in the benefit amount from Nu 30,000 to Nu 150,000, reflecting a strong commitment to supporting rural communities and safeguarding vulnerable households against economic shocks.
During the third session of the 4th Parliament, the Finance Minister had outlined the Government’s plan to review and strengthen the RLIS, directing the Finance Ministry to finalize the guidelines within six months and implement the revised scheme within the fiscal year. The proposed measures are designed not only to expand coverage and benefits but also to ensure that the system is sustainable, efficient, and capable of adapting to future social and economic challenges.
The rollout of the Rural Life Insurance Scheme is expected to transform Bhutan’s social protection landscape, providing rural citizens with a reliable safety net while demonstrating the government’s commitment to equitable and technology-enabled delivery of public services. With the scheme’s launch slated for before mid-2026, Bhutan is taking a decisive step toward inclusive and resilient rural development.
Nidup Lhamo
From Thimphu
