Fishery Insurance Policy Introduced in Nepal

Soon after the introduction of crops, poultry and livestock insurance, the Insurance Board has now introduced the fishery sector insurance policy. The Insurance Board makes it mandatory for the non-life insurance companies to introduce scheme on fishery insurance.

For buying the policies, the fish farm should be done in at least 200 sq. m. and 3 feet depth, except in the case of trout farming which has separate technical requirements.

The farmers can buy insurance policy by paying not more than two percent of the sum assured as premium amount, which is set as a higher limit bar for the insuring companies. But if fishes are grown adopting a highly intensive fish farming technology, a 10 percent discount will have to be given on the premium amount.



The insurance policy covers the loss from from fire, lightning, earthquake, floods, drought, typhoon, hailstorm, diseases, lack of oxygen, excess use of ammonia or use of poisonous substances, among others.

Compensation will be given to farmers based on product or production value. This means insurance coverage will be provided based on market value of fully grown fishes or cost incurred in rearing fishes till the time of their harvest. (This is unlike in the case of crops, livestock and poultry insurance (LinK) in which coverage is provided on cost incurred in growing products till the time of their harvest.) A compensation of 90 percent of sum assured will be given by insurers in the above mentioned loss reasons.

However, insurance companies does not compensates the claims on losses caused by carelessness or overcrowding of fishes in ponds, and if fishes have to be destroyed on government instruction.

Problems of Acquaculture in Nepal

Fishery in Nepal- A Glimpse:

An estimated 79,000 people are directly or indirectly involved in pond aquaculture activities nationally and the number is increasing. The fisheries and aquaculture sector in Nepal is under development and is one of the priority areas for the Ministry of Agriculture and Cooperatives and is gaining priority from the government. 21 Terai based districts have been declared as fish producing districts and each district has been assigned Fisheries Development Officers.

Overall Scenario:

Fish productivity in Nepal is 3.7MT/ha which is about the same as the regional average (India 3.9, Bangladesh 3.9). But, there are also lots of instances within Nepal where farmers are regularly averaging 10 MT/ha without the increase in capital expenditure. Low productivity is attributable to poor quality fish stock (seed), use of feed and poor pond management.

Fish farmers in Nepal feed the fish irregularly and do not use appropriate feed material hence locally produced table fish is well under-sized in comparison to imported fish from India. Imported fish tends to be 1 kg on average as compared to locally produced fish that is 200-300 gm.

Market Players in this sector:

Different kinds of market players are active in fishery sector; both at market and support roles. At the supporting roles, primarily government and Membership Based Organizations (MBOs) such as Fishery Association of Nepal (FAN) and Chamber of Commerce and Industries exists. Market players such as private hatcheries, nurseries and hawkers are observed in the fish seed businesses. Limited number of feed manufacturers such as Annnapurna Agro Feed and Himalayan Aqua Agritech and local suppliers exist in fish feed market.

Fish Seed supply-chain:

Fish seed can reach to the farmers directly through the hatcheries, through the middlemen hawkers and through the fisheries. Private hatcheries are the main suppliers of fish seed, supplying more than 80% of the total hatchlings, frys and fingerlings. They supply to the nurseries and also supply directly to the farmers. In the case of nurseries; they buy hatchling and/or fry from the hatcheries and raise them for a couple of weeks, make them 2-3 inches long and sell to the farmers. Farmers close to the hatcheries usually buy either from the hatcheries or buy through the hawkers whereas those who are away from hatcheries, buy fingerlings from the nearby nurseries.

Lease Policy is another hurdle:

Pond fish culture currently produces over fifty per cent of total fish consumed in Nepal (capture fisheries production and imported fish accounts for the remainder). An important factor affecting productivity in this segment is the Public Pond Leasing Policy. VDCs and Schools control and lease all the public ponds for about 3-5 years. Farmers wishing to start fish production are hesitant to make an investment in their ponds because there is no guarantee that they will be able to lease the pond again once the first leasing period is over. Majority of the people leasing ponds, under this arrangement, are small-scale farmers who make monthly installments on the lease. According to traders, many farmers pull out fish from their ponds before they reach their full size in order to make these monthly payments.

In a nutshell, low productivity is caused by improper pond management practices, the use of low-quality fish seed and inappropriate feed, lack of technical knowledge and information among farmers, and a fragmented production base inhibiting farmers’ access to sales and supply markets. This sector can be commercialised through the market intervention and policy level initiatives at the above mentioned constraints.