AGRICULTURAL INSURANCE

(1) There shall be established a Board which shall be called the Agricultural Insurance Board (hereinafter referred to as ” the Board “).

(2) The Board shall, by the name assigned to it by subsection (1), be a body corporate and shall have perpetual succession and a common seal and may sue and be sued in such name.

(3) The Board shall consist of such number of members, being not less than three and not more than seven, as may be appointed by the Minister of whom-

(4) The Minister shall appoint one of the members to be the Chairman of the Board.

(1) Every member shall, subject to provisions of subsections (2) and (3) the hold office for a period of three years from the date of his appointment:

Provided that a member appointed in place of a member who dies, resigns or otherwise vacates office, shall, unless he earlier resigns, dies or otherwise vacates office, hold office for the unexpired part of the term of office of the member whom he succeeds.

(2) Any member may resign from the Board by letter addressed to the Minister.

(3) Any member may be removed from office by the Minister without assigning a reason and such removal shall not be called in question in any court of law nor shall such member be entitled to any compensation for any loss or damage suffered by him, by reason of such removal.

(4) Where a member becomes by reason of illness or other infirmity or absence from Sri Lanka temporarily unable to perform the duties of his office, the Minister may appoint another person to act as member in his place.

(5) All members of the Board shall be remunerated in such manner and at such rates and shall be subject to such conditions of service as may be determined by the Minister with the concurrence of the Minister in charge of the subject of Finance.

(6) A member shall vacate office by death, removal, resignation or effluxion of time.

(7) Every member shall, unless he is removed from office, be eligible for reappointment.

(8) The quorum for the meetings of the Board shall be three members of the Board, and subject as aforesaid, the Board may regulate its own procedure.

(9) The Board may act notwithstanding any vacancy amongst its members.

(1) The seal of the Board shall be in the custody of the Board.

(2) The seal of the Board may be altered in such manner as may be determined by the Board.

(3) The seal of the Board shall not be affixed to any instrument or document except in the presence of two members of the Board both of whom shall sign the instrument in token of their presence.

(1) The Board may appoint to the staff of the Board such officers and servants as may be necessary for the efficient discharge of its functions.

(2) At the request of the Board, any officer in the public service may, with the consent of that officer and the Secretary to the Ministry charged with the subject of Public Administration, be temporarily appointed to the staff of the Board for such period as may be determined by the Board with like consent or be permanently appointed to such staff.

(3) Where any officer in the public service is temporarily appointed to the staff of the Board, subsection (2) of section 9 of the Motor Transport Act, No. 48 of 1957,* shall, mutatis mutandis, apply to and in relation to him. [• Repealed by Law No. 19 of 1978.]

(4) Where any officer in the public service is permanently appointed to the staff of the Board, subsection (3) of section 9 of the Motor Transport Act, No. 48 of 1957,* shall, mutatis mutandis, apply to and in relation to him. [• Repealed by Law No. 19 of 1978.]

(5) Where the Board employs any person who has entered into a contract with the Government for a specified period, any period of service to the Board by that person shall be regarded as service to the Government for the purpose of discharging the obligations of such contract.

(6) All officers and servants of the Board shall be deemed to be public servants within the meaning and for the purposes of the Penal Code.

(a) to operate a comprehensive agricultural insurance scheme for the benefit of farmers in respect of the paddy crop, and of such other crops (hereinafter referred to as ” specified crops”), as may be specified by the Minister by Notification published in the Gazette and in respect of livestock, which scheme will indemnify them against loss, provide a stabilizing effect on farm income, and promote agricultural production; and

(b) to undertake research necessary for the promotion and development of such agricultural insurance.

(1) The Board may exercise all or any of the following powers :-

(2) The Minister may by Order published in the Gazette authorize the Board, subject to such conditions as may be specified in the Order, to carry on any undertaking or business or to do any act or thing not mentioned in the preceding provisions- of this section, if he is satisfied that it is expedient so to do for any purpose connected with the efficient discharge and performance of the powers and duties conferred or imposed on the Board by such preceding provisions.

(3) Every Order made under subsection (2) shall as soon as convenient after publication in the Gazette be brought before Parliament for approval. Any Order which is not so approved shall be deemed to be revoked as from the date of disapproval, but without prejudice to anything previously done thereunder. Every Order which is not so revoked shall be as valid and effectual as though it were herein enacted.

(4) Nothing in the preceding provisions of this section shall be construed as authorizing the disregard by the Board of any law for the time being in force.

(1) Subject to the other provisions of this Law, every person having an interest in the paddy crop in any such area as may from time to time be determined for the purposes of this Part of this Law by the Minister by Order published in the Gazette, shall, with effect from such date as may be specified in such Order, be deemed to have entered into a contract of insurance with the Board against the loss of such crop arising from any such cause as may be specified in such Order (hereinafter referred to as a ” specified cause “).

(2) For the purposes of subsection (1), a person having an interest in the paddy crop shall mean an owner cultivator, a tenant cultivator, a landlord with tenant cultivators and a landlord with agricultural labourers, and any such person who is under subsection (1) deemed to have entered into a contract of insurance is hereinafter referred to as an ” insured person “.

In this subsection, ” owner cultivator”, “tenant cultivator”, “landlord” and ” agricultural labourers” have the same meanings respectively as in the Paddy Lands Act, No. 1 of 1958 * [* Repealed by Agricultural Lands Law, No. 42 of 1973,]

(3) The Board may, with the approval of the Minister by Order published in the Gazette, exclude from the provisions of this section, any area or extent of land where the risk of loss is considered excessive.

(1) The Board shall determine, and may from time to time alter, the amount of the premium to be paid by insured persons.

(2) Where two or more insured persons have shares in the paddy crop, the premium payable by each such insured person shall be determined by the Chairman of the Board, having regard to the share to which each such insured person is entitled.

(3) Such premium may be paid in money or in a quantity of paddy the value of which is equal to the amount of the premium, such value being computed according to the price for the time being of paddy under the Guaranteed Price Scheme, if that Scheme applies to such crop or, if that Scheme does not apply to such crop, according to such average of the market prices of such crop during the three years immediately preceding the year in which the premium is payable, as may be determined by the Board.

(4) Where the Guaranteed Price Scheme applies to the paddy crop, it shall be lawful for the Paddy Marketing Board or its authorized purchasers, at the request of the Agricultural Insurance Board, to deduct from the amount payable to the insured person as the price of any quantity of that crop purchased from him under that Scheme by the Paddy Marketing Board or its authorized purchasers, as the case may be, the amount of the premium payable to the Agricultural Insurance Board by the insured person under this Law.

(5) If an insured person who is liable to pay any sum as the whole or part of a premium fails to pay that sum within the time allowed by the Board, that sum shall be deemed to be in default and, together with an additional charge by way of interest at such rate as may be determined by the Minister by Notification published in the Gazette, shall be recovered on application made to the Primary Court having jurisdiction over the place where the extent of paddy land the premium in respect of which is in default is situated or where there is no Primary Court having jurisdiction over .that place to a Magistrate’s Court having jurisdiction over that place, by an officer authorized in that behalf by the Board in like manner as a fine imposed by such Court, and for the purposes of such recovery, the produce from the extent of land in respect of which such premium is payable shall be liable to seizure and sale.

(6) For the purpose of subsection (5), a certificate under the hand of the officer authorized in that behalf by the Board to the effect that the sum specified therein is due to the Board from the insured person shall be conclusive proof that such sum is due to the Board from such person.

(1) The computation of the amount of indemnity payable in respect of the loss of the paddy crop shall be made according to such terms and conditions as shall be specified by the Minister by Order published in the Gazette.

(2) Any sum due to an approved credit agency which has granted loans to an insured person for the purpose of paying the premium may be deducted from the amount of the indemnity payable to such insured person.

(1) Where an officer authorized in that behalf by the Board rejects a claim to indemnity made by an insured person or where an insured person is dissatisfied with the amount of the indemnity awarded to him by any such officer, such insured person may, within thirty days of the itself repealed by the Agrarian Services Act. notification to him of the rejection or of the award of the indemnity, as the case may be, make a written appeal to the Board, stating the grounds of appeal.

(2) The decision of the Board on any appeal under this section shall be final and conclusive and shall not be called in question in any court.

(1) For the purposes of this Part of this Law, where the amount of indemnities payable in respect of any season does not exceed fifteen per centum of the total insurance liability, such amount shall be paid out of the Agricultural Insurance Fund.

Where such amount exceeds the aforesaid fifteen per centum, the part of such amount which is equal to such fifteen per centum shall be paid out of the Agricultural Insurance Fund and the balance of such amount shall be paid out of moneys provided for the purpose by the Government.

(2) In this section, “total insurance liability” means the amount obtained by multiplying the total insured acreage of land cultivated with paddy in any cultivation season, by the maximum indemnity payable.

(a) the name of the insured ;

(b) the subject-matter of insurance ;

(c) the sum insured ;

(d) the term of cover;

(e) the causes of loss insured ; and

(f) such terms, exceptions, conditions and endorsements as may be determined by the Board.

(1) The initial capital of the Board shall be two million rupees.

(2) The initial capital of the Board may be increased from time to time by such amount as may be determined by the Minister with the approval of the Minister in charge of the subject of Finance.

(3) The amount of the initial capital of the Board and the amount of any increase of such capital referred to in subsection (2) shall be paid to the Board out of the Consolidated Fund in such instalments as the Minister in charge of the subject of Finance may, in consultation with the Minister, determine.

(4) As soon as possible after a payment out of the Consolidated Fund has been made towards the initial capital of the Board or towards its increase, the Minister in charge of the subject of Finance shall lay a statement of such payment before Parliament.

(1) There shall be established an Agricultural Insurance Fund (hereinafter referred to as ” the Fund “).

(2) There shall be paid into the Fund-

(3) There shall be paid out of the Fund all sums of money required to defray any expenditure incurred by the Board in the exercise, discharge and performance of its powers, functions and duties under this Law, and all such sums of money as are required to be paid out of such Fund by or under this Law.

(1) The Board may, with the concurrence of both the Minister, and the Minister in charge of the subject of Finance, or in accordance with the terms of any general authority given with like concurrence, borrow, by way of overdraft or otherwise, or negotiate and obtain on credit terms, such sums as the Board may require for meeting the obligations of the Board or carrying out its object:

Provided that the aggregate of the amounts outstanding in respect of any loans raised by the Board under this subsection shall not at any time exceed such sum as may be determined by the Minister with the concurrence of the Minister in charge of the subject of Finance.

(2) The Board may, with the consent of the Minister given with the concurrence of the Minister in charge of the subject of Finance, borrow money otherwise than by way of loan under subsection (1) for all or any of the following purposes :-

(1) The Minister may make regulations for the purpose of carrying out or giving effect to the principles and provisions of this Law.

(2) In particular and without prejudice to the generality of the powers conferred by subsection (1), the Minister may make regulations in respect of all matters which are stated or required by this Law to be prescribed or for which regulations are required by this Law to be made,

(3) Every regulation made by the Minister shall be published in the Gazette and shall come into operation on the date of such publication or on such later date as may be specified in the regulation.

(4) Every regulation made by the Minister shall as soon as convenient after its publication in the Gazette be brought before Parliament for approval. Any regulation which is not so approved shall be deemed to be rescinded as from the date of disapproval but without prejudice to anything previously done thereunder. Notification of the date on which a regulation is deemed to be rescinded shall be published in the Gazette.

(1) No Suit or prosecution Shall lie-

(2) Any expense incurred by such person as is referred to in subsection (1) in any suit or prosecution brought against him before any court in respect of any act which is done by him under this Law or on the direction of the Board shall, if the court holds that the act was done in good faith, be paid out of the Fund.

(1) Every person who contravenes or fails to comply with any provisions of this Law or any regulation made thereunder or any order or direction lawfully given under this Law shall be guilty of an offence under this Law.

(2) Every person who commits an offence under this Law shall on conviction after summary trial before a Magistrate be liable to imprisonment of either description for a period not exceeding one year or to a fine not exceeding one thousand rupees or to both such fine and imprisonment.

(3) Notwithstanding anything to the contrary in the First Schedule to the Code of Criminal Procedure Act, every offence under this Law, shall be a cognizable offence within the meaning of that Act.

(4) Where any offence under this Law is committed by a body corporate every person who at the time of the commission of the offence was a member, general manager, secretary, or other similar officer of the body corporate shall be deemed to be guilty of that offence unless he proves that the offence was committed without his consent or connivance and that he exercised all such diligence to prevent the commission of that offence as he ought to have exercised in the circumstances having regard to the nature of the offence.

(1) Where any immovable property of the Republic is required for the purpose of the business of the Board, such purpose shall be deemed to be a purpose for which a special grant or lease of such property may be made under section 6 of the State Lands Ordinance, and accordingly the provisions of that Ordinance shall apply to a special grant or lease of such property to the Board.

(2) Where any movable property of the State is required for the purpose of the business of the Board, the Minister may by Order published in the Gazette transfer to and vest in the Board the possession and use of such movable property.

(3) Where any immovable property is required to be acquired for the purpose of the business of the Board, and the Minister, by Order published in the Gazette, approves of the proposed acquisition, that property shall be deemed to be required for a public purpose and may accordingly be acquired compulsorily under the Land Acquisition Act and be transferred to the Board.

(4) Any sum payable for the acquisition of any immovable property under the Land Acquisition Act for the Board shall be paid by the Board.

(a) has concealed or misrepresented any material fact or committed any fraud relating to the insurance, or

(b) fails to comply with any term or condition of such contract.

(1) The amount of any premium under a contract of insurance under this Law shall be paid in cash or in the specified crop to which that contract relates or partly in cash and partly in that specified crop.

(2) The Board may, as often as it is necessary, sell any part of the Fund which consists of specified crops, and shall credit to such Fund the proceeds of the sale after deducting therefrom the expenses incurred in the sale.

(1) The Board or any officer authorized in that behalf by the Board may enter and inspect any land on which there is any specified crop or any insured livestock and any documents relating thereto and it shall be the duty of every person who is in occupation of such land to permit and assist such inspection.

(2) Every person who fails to comply with the provisions of subsection (1) shall be guilty of an offence and shall, on conviction after summary trial before a Magistrate, be liable to a fine not exceeding one hundred rupees.

(1) The Crop Insurance Act, No. 13 of 1961, is hereby repealed.

(2) Notwithstanding the repeal of the Crop Insurance Act, No. 13 of 1961, all liabilities by way of premium payments by insured persons pending and payable under the provisions of that Act, shall, on the date of commencement of this Law, be deemed to be payable to the Board.