Towards a Higher Rural Life Insurance Compensation

Towards a Higher Rural Life Insurance Compensation

People say that increasing rural life insurance compensation, giving it as soon as someone dies and getting it from the LG would be a priceless gift

About 79%, which totals to around 615,000 of the population in the country received rural life insurance subsidy last year, amounting to about Nu 67mn, according to the finance minister, Namgay Tshering.

Replying to a question from National Assembly (NA) Member of Parliament (MP), Dungtsho Karma Wangchuk of Chhumig-Ura constituency, Bumthang during the 9th Session of the Third Parliament on June 16, 2023, on the possibility to increase the current rural life insurance scheme, the finance minister also said that there is a possibility to increase even up-to Nu 100,000 but with proper re-structuring of the current rural life insurance scheme.

Meanwhile, people, especially the economically underprivileged say that rural life insurance compensation needs to be increased as the demise of a person is a very expensive matter.

The finance minister said that the government has full support to increase the rural life insurance scheme.  He added that currently, the rural people get Nu 30,000 as compensation, while they pay Nu 87 and the government pays Nu 108 as a subsidy. Thus, Nu 195 is paid yearly as rural life insurance.

The minister said that with the Fourth King’s Vision, during the 1980’s, the people were compensated with Nu 10,000, and in the year 2009, the compensation increased to Nu 15,000. In 2017 the compensation was increased to Nu 30,000.

The finance minister said that rural life insurance has increased over the years as it plays a significant role in the society and said that it is a must to provide support. However, it will be exclusively for the rural population.

MP Karma Wangchuk shared that it is a concern for the rural people and that they are hoping for an increase in the current rural life insurance scheme of Nu 30,000 to a minimum of Nu 50,000 and a maximum of Nu 70,000 to Nu 100,000.

The finance minister, Namgay Tshering said that currently the government and the Royal Insurance Corporation of Bhutan Limited (RICBL) is working to increase the rural life insurance scheme and the minister shared that if the government does a proper structure on the rural insurance scheme subsidy, even providing Nu 100,000 will not be a problem.

The minister said that by looking at the number of eligible people of the rural life insurance scheme, the fact and need for proper structure arises. “If it says rural life insurance, then it should be focus on the rural people who are not able to pay. As for the people who earn more income and people who live in urban areas, Nu109 is not an issue, since they can pay themselves and the subsidy won’t make much difference,” the minister said.

Meanwhile, people in rural parts of the country, especially the economically poor say that increasing rural life insurance compensation would be one of the most important gifts that they wold receive.

“As we all know, once a person dies, we have to do a series of religious rituals. It begins from death till the 21st day and even the 49th day. We do not have the economic resources to do so and feel very bad for the person who has died,” Karma, from Monggar said.

She added that though the government is providing Nu 30,000, everything has become expensive. “It is not even sufficient to pay the Lams and gomchens,” she said.

Karma also said that it would be very good if the family could get the Nu 30,000 right after demise of a person. “We get it late and it is during the first days that we really require money,” she added.

The same was echoed by Pema from Trashigang. “I will not blame our religion but culture. The demise of a person has become an expensive affair and I have seen people who are poor not conducting any rituals and cremating the dead as soon as possible.”

Pema says that due to this, families and houses are ostracized, though it is because of economic reasons. “Nu 30,000 is something, but very less, especially considering that the rates of all goods have increased,” he said.

Rinchen from Trashigang also said the same. “The demise of a person involves a lot of expenditure. Due to this, people have also started forming groups (Tshogpas). But everything cannot be done by the group,” he said.

In addition to the need for increase, he also echoed Karma and said it would be a great benefit if the money is given as soon as some one dies. “This is the time when you need money. Further, sometimes, people are asked to go to the districts to claim it. I think that the local government can easily do this,” he added.

According to prevailing Buddhist practices, after the demise of a person, the first, second and third weeks are considered very important, especially the 21st day. It is believed that rituals need to be conducted on these days. Based on an individual’s economic capacity, rituals are sometimes conducted continuously for 21 days. The 49th day is also considered important.

Additionally, after a person dies, an astrologer is consulted, who inform family members of different rituals that need to be conducted for the departed soul.

Apart from rituals, expenses are also incurred for prayer flag posts, which are again considered important for the dead. 

Sherab Dorji from Thimphu