Why are sugar planters being unjustly penalised?

The Sugar Insurance Fund Board insures sugar planters against cyclone, drought, excess rainfall and fire. From the sugar proceeds, the board deducts a chunk as annual general premium which may exceed 10% of the gross income. The planter also contributes to a premium for fire insurance.

Motor vehicles run on public roads and are more exposed to risks than sugar cane plantations. Yet the premium for motor vehicles is generally 3% of their market value. Why is the premium for sugar insurance so high?

Under section 37 of the Sugar Insurance Act, no compensation is payable to a planter when his burnt cane can be harvested and milled in any factory which may be in operation. This clause puts great stress on the planter.

When his plantation is destroyed by fire at a time when the factory in his factory area is not in operation, it is a moment of fire-fighting for him. He does not have all the resources to send the burnt cane to some other factory which may be on the other side of the island. Moreover, harvesting and transporting the cane to the other factory may leave him with a loss at the end of the day. So, he is left with two options: leave the cane in the field, or wait for a factory in his factory area to restart its operations. In the meantime, the cane may be unfit for milling and has to be dumped.

In other words, the planter is being made to pay ‘le pot cassé’ of the centralisation of factories.

I am a planter of Terra Milling Ltd. A major portion of my sugar cane field was burnt on 26 June 2012. I sent two truckloads of cane to Fuel on 3 July. The cane was refused for lack of purity. My claim for compensation was turned down by the SIFB. Even the excess mileage cost was refused, though the cane was still immature, and was to be harvested by September 2012.

What is the purpose of being insured when in the occurrence of an event for which you are insured you do not receive any compensation? Sugarcane planters would like to know why they should be denied their compensations in spite of their contributions through the payment of a premium to the Fund whereas stakeholders in other sectors of the economy receive stimulus packages, subsidies, grants, and other allocations for bad weather conditions.

Is it not time to review and amend certain sections of the Sugar Insurance Act to ensure that planters are not unjustly penalised?

 


* Published in print edition on 14 June 2013

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